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Here? Nothing. We declare that our bank-based (as opposed to market-based) financial system works well and we press on with deregulation and market liberalisation.


A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith
by Migeru (migeru at eurotrib dot com) on Sun Sep 21st, 2008 at 03:44:03 PM EST
[ Parent ]
Bank based finance is a huge part of the reason that Europe isn't having the problems that the US is right now, excepting of course the contagion that's spreading from Wall Street.

Bank capital has more incentive to think long term, rather than engage in speculative investing.  Maybe there should be a small securities transaction tax to slow down volume on mercantile exchanges and create an incentive for long(er) term investing.

And I'll give my consent to any government that does not deny a man a living wage-Billy Bragg

by ManfromMiddletown (manfrommiddletown at lycos dot com) on Sun Sep 21st, 2008 at 04:39:16 PM EST
[ Parent ]
But Bank-based finance is subject to Basel II which is a bloody mess.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith
by Migeru (migeru at eurotrib dot com) on Sun Sep 21st, 2008 at 05:20:13 PM EST
[ Parent ]
Migeru:
We declare that our bank-based (as opposed to market-based) financial system works well and we press on with deregulation and market liberalisation.

Hedge funds plan to sue FSA over short-selling ban - Telegraph

¨The FSA's remit is to maintain orderly markets - the markets were working fine, only the banks were going bust.¨
by ThatBritGuy (thatbritguy (at) googlemail.com) on Sun Sep 21st, 2008 at 05:28:02 PM EST
[ Parent ]
They have a point, you know? Short-selling is being blamed for insolvency which makes no sense. And, as I pointed out before, short-selling can be simulated with futures and options so the ban is just for show.

A vivid image of what should exist acts as a surrogate for reality. Pursuit of the image then prevents pursuit of the reality -- John K. Galbraith
by Migeru (migeru at eurotrib dot com) on Sun Sep 21st, 2008 at 05:38:35 PM EST
[ Parent ]

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