Whilst I won’t claim to have watched the full 3 hours and 15 minutes of the Kangaroo Court, sorry I mean the Treasury Select Committee’s grilling of the naughty bankers from HBoS and RBS I watched enough to get annoyed. We all know that a few bankers have made ridiculous amounts of money by exploiting significant weaknesses in the system but what about the hundreds of thousands of ordinary bank workers who are not paid a fortune and in no way contributed to the banking systems failures?
In my view they should not be denied a bonus provided the bank can actually afford to pay out the cash. What I found more annoying was that the real culprits are getting away scot free. The reason we are in this situation is that the cost of credit has been dirt cheap for ten years and borrowers and bankers have gorged themselves on this seemingly unlimited supply of happiness. It is a statement of the obvious that if credit is predicted to be cheap and in plentiful supply, bankers will take more risks when lending it and borrowers will consume more of it. The whole economy has been based on this assumption since Gordon Brown stated continuously that he had banished the ‘Boom and Bust’ cycle and we could all look forward to a low inflation, low interest rate environment. Is it really that surprising that bankers and borrowers believed the government’s story that we were in a period of sustainable growth rather than a massive bubble?
Bashing the bankers seems about as useful as smacking the kids because they have eaten all the sweets in the sweet shop. I blame the parents!
