The Great Debate UK
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.
And that’s what most people want today, a government that can help the citizen without hindering the economy through the dogma of dated ideology. The old notion of socialists waging war on small-government-right-wingers feels somehow quaint. Clearly Tony Blair knew that David Cameron would be his successor in the New Labour project, but nobody told Gordon Brown.
Now the back room deals have been done between the Conservatives and Liberal Democrats, and the cabinet post announcements are being released from Downing Street, the real work has to begin. I don’t just mean the public sector cuts. Any new government would have to cope with the deficit, though many in Labour are probably grateful that it’s the Tories who are going to be seen slashing public services.
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
- 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
- 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.
from Commentaries:
Do banks really need to hoard liquidity?
That's the provocative question posed by Willem Buiter. His latest, characteristically lengthy, blog post tackles the regulatory vogue for forcing banks to hold much greater reserves of liquid assets - in practice, government bonds.
Buiter's missive follows new rules from Britain's Financial Services Authority, which will force banks to increase their reserves of government bonds by more than a third. The rules have been met with predictable bleating from the industry, which accuses the regulator of undermining Britain's competitiveness and promoting the fragmentation of the global financial system. Another concern is the FSA's handling of the transition.
