No. We can’t move on until there has been some blame and some punishment. You say it is scape-goating, but the fact of the matter is that the bankers had all the power so they also have the responsibility. People who bought houses at the top of the boom did so because they were terrified into believing they had to get on the ladder or be shut out of ever owning property by boosters and cheerleaders of the boom.
Thanks for dropping by. I agree bankers had considerable power, but we equally paid regulators to control them for that very reason and they didn’t do their job, in effect, they let the animals run the zoo and then they blame them for behaving like the animals they are.
The terror buying and ensuing negative equity will not be fixed by punishing a banker, that point is vital, and it is also why I think that the majority of effort should be directed towards policy to solve the issues and prevent them rather than on trying to solve the last financial crisis.
Punishment for wrongdoing has to be based upon fact, and in that area we are sorely lacking on the speed of information gathering and on initiating legal action, but that is also because in many cases there was not an actual law broken or they were not clearly defined boundaries of what was done wrong even though the end result was awful, immoral and illegal remain distant cousins when they should be brothers.
thanks for coming by!
karl
Thanks karl. I’m actually a regular reader, but I don’t usually comment because I don’t have an economics background. This issue seems different though.
I don’t think it matters, as far as blaming the bankers is concerned, that the financial regulator was in dereliction of his duties. How is that different from letting the criminals off and blaming the Guards for not catching them? You say: What the bankers did was not technically illegal. Well, they should have known it was a) imprudent and b) immoral and c) we’ll just see whether it wasn’t illegal… We justly blame them because they are responsible for the mess. The fact that if the regulator had been doing his job properly they wouldn’t have been able to get away with it for as long as they did is neither here nor there. They shouldn’t have been conducting business in the way they were.
I agree that punishing the bankers won’t itself solve the problem, but it is necessary to bring the public onside. People will feel profoundly aggrieved if they are expected to endure hardships to put right other people’s mistakes while those responsible get off scot-free. To restore confidence to the (domestic) market, you have to cater to people’s sense of justice. (I’m not saying that’s enough in itself, only that it is a sine qua non for a recovery).
No. We can’t move on until there has been some blame and some punishment. You say it is scape-goating, but the fact of the matter is that the bankers had all the power so they also have the responsibility. People who bought houses at the top of the boom did so because they were terrified into believing they had to get on the ladder or be shut out of ever owning property by boosters and cheerleaders of the boom.
No. We can’t move on until there has been some blame and some punishment. You say it is scape-goating, but the fact of the matter is that the bankers had all the power so they also have the responsibility. People who bought houses at the top of the boom did so because they were terrified into believing they had to get on the ladder or be shut out of ever owning property by boosters and cheerleaders of the boom.
Hi Andrew,
Thanks for dropping by. I agree bankers had considerable power, but we equally paid regulators to control them for that very reason and they didn’t do their job, in effect, they let the animals run the zoo and then they blame them for behaving like the animals they are.
The terror buying and ensuing negative equity will not be fixed by punishing a banker, that point is vital, and it is also why I think that the majority of effort should be directed towards policy to solve the issues and prevent them rather than on trying to solve the last financial crisis.
Punishment for wrongdoing has to be based upon fact, and in that area we are sorely lacking on the speed of information gathering and on initiating legal action, but that is also because in many cases there was not an actual law broken or they were not clearly defined boundaries of what was done wrong even though the end result was awful, immoral and illegal remain distant cousins when they should be brothers.
thanks for coming by!
karl
Thanks karl. I’m actually a regular reader, but I don’t usually comment because I don’t have an economics background. This issue seems different though.
I don’t think it matters, as far as blaming the bankers is concerned, that the financial regulator was in dereliction of his duties. How is that different from letting the criminals off and blaming the Guards for not catching them? You say: What the bankers did was not technically illegal. Well, they should have known it was a) imprudent and b) immoral and c) we’ll just see whether it wasn’t illegal… We justly blame them because they are responsible for the mess. The fact that if the regulator had been doing his job properly they wouldn’t have been able to get away with it for as long as they did is neither here nor there. They shouldn’t have been conducting business in the way they were.
I agree that punishing the bankers won’t itself solve the problem, but it is necessary to bring the public onside. People will feel profoundly aggrieved if they are expected to endure hardships to put right other people’s mistakes while those responsible get off scot-free. To restore confidence to the (domestic) market, you have to cater to people’s sense of justice. (I’m not saying that’s enough in itself, only that it is a sine qua non for a recovery).
No. We can’t move on until there has been some blame and some punishment. You say it is scape-goating, but the fact of the matter is that the bankers had all the power so they also have the responsibility. People who bought houses at the top of the boom did so because they were terrified into believing they had to get on the ladder or be shut out of ever owning property by boosters and cheerleaders of the boom.