Thursday 18 June 2009

Financial Regulation, Regulation, Regulation


Bit of a contrast with what the governor of the Bank of England and Alistair Darling say about the "R" word. Yet this recession illustrates that people need to be protected from the banks and banks need protecting from themselves. This situation of putting foxes in charge of the hen house doesn't work.

Some degree of regulation is needed, what form and how much is obliviously a debate in itself. What I would like to see though is greater protection for consumers, going into a bank is like walking into a tigers den. Credit cards, loans, mortgages, over drafts all at a competitive rate of *6%. Obama has announced plans for a consumer body that would stop 'predatory lending', given this was part of the catalyst for this recession, it makes sense to address that. Yet what does our government do, nothing.

Alistair Darling says "more needed to be done, notably to increase the availability of credit." Why didn't they make that part of the criteria for bail out money? Who on earth signs a cheque for billions without having terms. I guess the same people who made Fred Goodwin a millionaire and a Sir. If the nationalised banks started lending others would have followed suit, if they lowered interest rates on mortgages, other banks would have needed to be competitive. That's one area that would really help out a lot of home owners and people trying to get on the property ladder. Yet nothing.

It really disappoints me that from this recession, so much could be done to improve and stabilise our economy. Like supporting our industry, products have to be made and food has to be grown, it makes sense to me at least to spread the risk and not just rely on financial services. Particularly by supporting industries essential to everyday life. Yet nothing, this will become a missed opportunity.


* Terms and conditions apply 2 months bonus rate only, normal rate 25%.


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