Tuesday, October 14, 2008

UK Bail-out to change the face of banking - Telegraph The Failure of Free Markets

Economists forecast massive state regulation that will reduce the once buccaneering banking industry to little more than a utility, like gas and electricity. Restrictions on lending policies and tighter demands on risk management are expected to restrain growth and limit shareholder returns.

“The world is going to be very different,” said Willem Buiter, a former member of the Bank of England’s Monetary Policy Committee. “Appropriately so, as the old system collapsed, having caused imprudent lending and encouraged reckless borrowing. Banking will probably get supervised rather more tightly than some of the utilities now.”
UK Bail-out to change the face of banking - Telegraph
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