The Great Debate UK

Roger Bootle on the Future of Banking Commission



-Roger Bootle is the managing director of Capital Economics. The opinions expressed are his own.-

I was invited to join the Future of Banking Commission by John (now Lord) McFall, then Chairman of the House of Commons Treasury Select Committee, to which I have been a specialist adviser for 13 years.

John is a dedicated public servant and a very persuasive man, as all those who appeared in front of the Treasury Committee can testify. I found it very difficult to refuse his invitation.

As it happens, I had been thinking deeply about many of the questions that the Commission had been asked to examine in connection with my book, The Trouble with Markets, which was published last year. So in many ways, what I experienced with the Commission was rather like seeing the live performance of a play that you had previously only read.

Cameron tasked with changing Brits’ expectations


– Mark Kobayashi-Hillary is the author of several books, including ‘Who Moved my Job?’ and ‘Global Services: Moving to a Level Playing Field’. The opinions expressed are his own –

After thirteen years, it’s all over. The New Labour project is dead. Or is it? Tony Blair brought British politics to the centre-ground and ensured that a single party could support free-market economic policies as well as social justice.

from The Great Debate:

Drugs, terrorism and shadow banking

The trouble with moving big amounts of cash, from a criminal's point of view, is threefold. It's bulky, it's heavy and it smells.

A stash of $1 million in mixed bills weighs around 100 pounds (50 kilos). Specially-trained dogs can sniff out bulk cash in a heartbeat.

Ending the disconnect between politics and business


manwaring- Tony Manwaring is Chief Executive of Tomorrow’s Company. The opinions expressed are his own. -

Britain will soon be voting for a new government.  It should be time to discuss the big issues which will define the years ahead, notably how are we, as a nation, going to pay our way in the years ahead? Our confidence that financial services and Cool Britannia will replace manufacturing and heavy industries now looks sadly misplaced.

from The Great Debate:

Did Asperger’s help cause the crisis?

Did the financial system blow up because it was built and largely operated by people with many of the characteristics of a mild form of autism called Asperger's syndrome?

As explanations for the crisis go, it's on the extreme side but forms an interesting counterpoint to the "blame the looting bankers" story line.

from The Great Debate:

Lowering risks from large, complex financial institutions

-- Robert R. Bench, a former deputy Comptroller of the Currency, is a senior fellow at the Boston University School of Law Morin Center for Banking and Financial Law. The views expressed are his own. --

Financial institutions inherently are fragile.

As intermediaries, they are exposed to both exogenous and endogenous threats. The 2007-2008 financial crisis was caused by endogenous forces.  Simply, financial institutions were poorly governed, taking-on extreme liabilities and gambling them into high risk activities.  The meltdown of the financial system fed contractionary forces into the real economy, causing our "great recession," creating negative exogenous loops back into financial institutions.

from The Great Debate:

Welcome to the Teenies, sorry about those returns

-James Saft is a Reuters columnist. The opinions expressed are his own-

As we say goodbye to a decade so abysmal it never even earned a nickname, it is time to take bets on how the coming 10 years will shape up in economics and financial markets.

Welcome, then, to the Teenies, a word that will describe the decade as well as the small returns in financial markets and the shrinking financial sector it will bring.

Time to discuss the future of banking


New Peter Vicary Smith- Peter Vicary-Smith is the chief executive of Which? The opinions expressed are his own. -

Since the financial crisis in October 2008, a number of reports have looked at the causes and consequences of the crisis and suggested possible solutions, but they’ve all been written from the perspective of bankers.

from Breakingviews:

Whatever happened to the Russian bank crisis?


Just a few months ago, there was widespread alarm in Russia about the state of the country's banking sector.

In June, rating agency Fitch predicted that impaired loans would reach 25 percent of all loans by the end of this year, requiring at least $22 billion in additional capital. Other analysts warned that the final bill could reach $60 billion. But as the smoke clears, it seems increasingly obvious that these concerns were greatly overblown.

from Breakingviews:

Strong local units good for bank reform


The debate about reforming the financial system is often presented as an argument between regulators on one side and banks on the other. But it is also beginning to throw up some differences among banks. One such rift has been exposed by the suggestion that banks should be forced to hold greater reserves of liquidity and capital in national subsidiaries.

Regulators see this as a way of dealing with the future failure of a big bank. Rather than relying on the bank's home government to pick up the tab -- something it may not be able or willing to do -- each country where the institution operates could take responsibility for its local subsidiary.