Bankers as trapeze artists, central planners and markets July 30, 2013 THERE are three ways we can organise banking. The first, which I don’t recommend, is to adopt the pre-2008 model; the second is the current approach, which seeks to micro-manage everything and which will also fail; and the third would be to allow genuine market discipline to be reinstated. Under the first approach, there [...]
Hamstringing banks with higher capital requirements will not stop the next crisis July 30, 2013 GREAT fallacies periodically grip the British establishment and cause enormous harm to the economy. The last big one was the obsession with joining the European Exchange Rate Mechanism at the end of the 1980s. Now we have the regulative fallacy. The great and the good are in its grip. They identified banks and excessive debt [...]
Why we musn’t fear the rise of emerging market state-backed champions July 28, 2013 WHAT do Airbus, Michelin, Hyundai, NEC, Samsung, Singapore Airlines, Volkswagen, and LG have in common? They all started life as national champions, companies supported by the state while their countries emerged from the ravages of war. Although advanced economies have rightly shifted away from the model, the achievements of these firms in the global marketplace [...]
Letters to the Editor – 29/07 – Church loans, China economy, Best of Twitter July 28, 2013 Church loans [Re: Church of England launches probe into link with Wonga, Friday] The Church should be applauded for the proposed venture into the payday lending market. Its decision is laudable not because there is anything evil about Wonga, nor because of the supposed moral desirability of constraining reckless capitalism. The archbishop’s intention to outcompete [...]
We must urgently improve the quality of our economic growth July 24, 2013 BARRING an astonishing shock, today’s second quarter UK GDP figures will be good. But while economic activity is now clearly increasing again, I’m deeply worried about the quality of the growth and its sustainability when monetary policy is eventually tightened. Ever since the Keynesian revolution, the City and government have been far too obsessed with aggregate, [...]
Bottom Line: Competition concerns could hert(z) July 22, 2013 AS TALKS between Telefonica and KPN dragged into the night yesterday, it soon became clear that regulatory concerns remain the biggest threat to any deal being agreed. It’s no wonder the talks have been revived after years of to-ing and fro-ing between the parties – the German wireless market is incredibly competitive, and a merger [...]
Lessons for regulators from Chris Froome’s Tour de France victory July 21, 2013 MANY of us have been enthralled by Chris Froome’s Tour de France win, helping restore our faith in this global event. Cycling’s regulator’s overwhelming problem is to maintain the credibility of the competition by deterring, detecting and punishing cheating. We can use the Union Cycliste Internationale (UCI) as an analogy for the British financial regulatory [...]
Why unpaid internships are a good thing – they help the young get a foot in the door June 24, 2013 MY COMPANY is currently looking for an intern (don’t all apply at once). The reason is simple. We have a job that needs doing that we cannot get our clients to pay us for and, in the current climate, we cannot afford to pay an experienced person to do it. The work we want doing [...]
Once again, it’s the old question: who guards the guardians? June 17, 2013 AS ever, the ancient Greeks and Romans got there before us; they couldn’t conceivably have dreamt of the internet, of the cloud or of National Security Agency (NSA) super-computers in Fort Meade, Maryland, in an as yet undiscovered continent, combing through trillions of phone calls, emails and Facebook pages, but they’d already nailed the gist of [...]
Reality is intruding on the extreme claims of climate change alarmists May 1, 2013 A COMMON feature of debates about global warming is that extreme claims often go unchallenged. At best, criticism is impolitic. Worse, critics are portrayed as tools of malign fossil fuel interests. Being impervious to push-back leads to what I describe in my recent book as climate change derangement syndrome, when normally sane people say dumb [...]