Do not pass Go. Do not collect bonuses.

[expat]

"The capitalist class has managed society, and its management has failed. ... The point really is that the mass of mankind is miserable, not for want of the wealth taken by the capitalist class, but for want of the wealth that was never created."
Jack London. 1905

[OwlHoot]

That was before the communist revolutions in Russia and China (and Vietnam, and Cuba, etc, etc, most of the poorest most miserable countries you can think of until they embraced capitalism)

Anyway, arguably this whole debt problem has been caused by capitalists being too accomodating to the poor, in other words dabbling with socialism and not being capitalist enough!

[Mich the Tester]

Anyway, arguably this whole debt problem has been caused by capitalists being too accomodating to the poor, in other words dabbling with socialism and not being capitalist enough!

Wot, you mean lending unemployed chavs money for a big house and a SUV?

[OwlHoot]

Wot, you mean lending unemployed chavs money for a big house and a SUV?

I see what you mean. It's hard to know where the capitalism stops, and stimulating demand is part of it.

All the same, Governments in the US and elsewhere put a lot of pressure, including by legislation, on banks to increase their sub-prime loans, and that's basically a socialist agenda.

[Bagpuss]

Unfettered capitalim can't work, just as Communism can't work. There needs to be control, otherwise you get chaos.

[Mich the Tester]

Unfettered capitalim can't work, just as Communism can't work. There needs to be control, otherwise you get chaos.

Who does the controlling? Gordon?

[Bagpuss]

The fat controller. Seriously, the banking fiasco was caused by unfettered capitalism, we need some sort of safegard that the whole economy isn't just some massive gamble.

[Mich the Tester]

The fat controller. Seriously, the banking fiasco was caused by unfettered capitalism, we need some sort of safegard that the whole economy isn't just some massive gamble.

The safeguards have been in place; the FSA and in the US the SEC were supposed to ‘supervise’ banking, but they seem to have been fast asleep all these years. Of course the last couple of years the FSA was run by one of the unqualified crooks that buggered up HBOS, which made it as good as useless.

Perhaps it’s just a case of applying the existing laws with some more discipline. Perhaps directors of listed companies should be held personally liable if gross negligence or incompetence can be demonstrated.

[Lockhouse]

The safeguards have been in place; the FSA and in the US the SEC were supposed to ‘supervise’ banking, but they seem to have been fast asleep all these years. Of course the last couple of years the FSA was run by one of the unqualified crooks that buggered up HBOS, which made it as good as useless.

Perhaps it’s just a case of applying the existing laws with some more discipline. Perhaps directors of listed companies should be held personally liable if gross negligence or incompetence can be demonstrated.

Investment banking needs to be split from high street banking like it used to be. Otherwise you get investment bankers taking massive gambles with money that really isn't theirs to gamble with. That's not the whole cause of the current problems, but it's a large one.

[Mich the Tester]

Investment banking needs to be split from high street banking like it used to be. Otherwise you get investment bankers taking massive gambles with money that really isn't theirs to gamble with. That's not the whole cause of the current problems, but it's a large one.

Good point. Another possibility is to look to a return to cooperative banks and mutuals. Here in NL the Rabobank are doing OK; they never had to take big risks as they only had to deliver returns for their savers (members) and didn't have to please shareholders. In fact, I've heard that the cooperative banks all over Europe are doing OK.