Editor's letter
As Credit went to press, the City of London was an unwilling host to thousands of demonstrators, many marching with a confused message of "jobs, justice, climate". Their choice of targets seemed just as muddled: one focus was the Bank of England, which - whatever one's views of its current policies - is doing its best to find a way through the economic crisis.
Although many of the Square Mile's unwelcome visitors see 'protest' as a hobby, regardless of the cause, no doubt the protestors' numbers were swelled by people unused to taking to the streets, who feel understandable outrage at the turn in their fortunes as the downturn worsens. Credit has always pursued a strong editorial line that there were excesses in the system, and that the urgent - but not precipitate - necessity of some regulatory and procedural change is clear, even if the market has to some extent corrected itself, as markets do. We would, for example, be very interested to hear from anyone who's been sold a new CDO-squared recently.
But justifiable as some level of public grievance might be, it is absurd to lay blame exclusively at the feet of the bankers. Regulators and politicians are at fault too; especially here in the UK, where the tripartite regulatory system was much trumpeted, as was Gordon Brown's claim, as Chancellor of the Exchequer, to have abolished boom and bust.
But it's not just the powerbrokers in government, the financial wizards on structured credit desks, or yield-hungry institutional investors who are to blame. For all their evident and myriad faults, the system required participation from the consumer. No-one had to take a 100% mortgage, and for every aggrieved Icesave account-holder there's a saver who one day in the past congratulated himself on getting the 'best' interest rate, forgetting that interest is a measure of risk.
It would be too much to hope that the protestors in the City gave much thought to this truth as they clashed with the police. But on April 1 who did they think was working harder to effect a recovery? The thugs smashing their way into that RBS branch near the Bank of England, or the men and women at their desks?
Matthew Attwood.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
More on Regulation
As risk of US Basel delay grows, Europe is in a bind over CVA
European Commission may postpone FRTB, but it’s hard to separate surgically from rest of framework
FRTB start dates must align globally, says European Commission
Lawmaker could trigger delay to market risk rules in Europe if US implementation drags on
Fed green lights more capital relief trades
Five US banks authorised to issue repeat credit-linked notes backed by financial guarantees
Basel III endgame: why moving fast might prove better for banks
Republicans are pushing for reproposal, but a rapid finalisation may prove less far-reaching
Isda pushes to ‘decouple’ Simm calibration from model changes
Emir 3.0 prompts effort to separate risk-weight revisions from methodology updates
Basel war on window-dressing may smooth liquidity, at a price
Changes to G-Sib charge could curb year-end repo volatility, but also cut balance sheet capacity
One year on, regulators still want a cure for bank runs
Broad support for higher outflow assumptions on uninsured deposits, but that won’t save insolvent banks
Watchlist and adverse media monitoring solutions 2024: market update and vendor landscape
This Chartis report updates Watchlist monitoring solutions 2022 and focuses on solutions for sanctions (name and transaction) screening and monitoring adverse media and its related elements
Most read
- New FICC clearing model still holds fears for buy side
- OCC introduces new intraday risk charge covering zero-day options
- Too soon to say good riddance to banks’ public enemy number one