• Home
  • About us
  • Contact Us
  • Date/Time
  • Login
  • Subscribe

logo

  • Home
  • Politics
  • Economics & Finance
  • World
  • Arts & Books
  • Life
  • Science
  • Philosophy
  • Subscribe
  • Events
Home
  • Home
  • Blogs
  • Politics
  • Economics & Finance
  • World
  • Arts & Books
  • Life
  • Science
  • Philosophy
  • Subscribe
  • Events
  • Home
  • Economics & Finance

Crisis watch: Lehman’s wrong lesson

by JONATHAN_FORD / July 10, 2009 / Leave a comment
  • Facebook
  • Twitter
  • Linkedin
  • Email
crisis_watch-11

Learning from Lehman

“Here’s your money,” is the near universal refrain from the bankers to the politicians. “We want our laissez-faire economy back. If you won’t give it to us, we won’t lend and there won’t be any recovery. And if that’s the case, it will be your fault.”

People have pondered long and hard since last September whether the US government was right to allow Lehman Brothers to collapse. Some believe that it was a reckless act that imperilled the global financial system. Others think it was a necessary shock that gave us at least a chance of changing behaviour in the financial system and checking the bubble mania of recent years.

I am in the latter camp, but find myself increasingly feeling that the opportunity to reform the financial system has been fumbled. We have had the pain without the gain, so to speak. The view now seems to be that the crisis of last autumn was so scary that it is imperative that the system should be shored up quickly, even at the cost of effective reform. Hence the queue of banks on either side of the Atlantic clamouring to repay their government money. They want to get back in the game as fast as possible.

The Lehman crisis was supposed to shock the financial system into behaving better—to force it take fewer risks with investors’ (and ultimately taxpayers’) funds. But far from c…

YOU’VE HIT THE LIMIT

You have now reached your limit of 3 free articles in the last 30 days.
But don’t worry! You can get another 7 articles absolutely free, simply by entering your email address in the box below.

When you register we’ll also send you a free e-book—Writing with punch—which includes some of the finest writing from our archive of 22 years. And we’ll also send you a weekly newsletter with the best new ideas in politics and philosophy of culture, which you can of course unsubscribe from at any time







Prospect may process your personal information for our legitimate business purposes, to provide you with our newsletter, subscription offers and other relevant information.

Click to learn more about these interests and how we use your data. You will be able to object to this processing on the next page and in all our communications.

18585516495c6f7d1e43d268.49253327

Go to comments

Related articles

Open information
Alasdair Smith / September 19, 2018
Who will benefit from using your financial data?
Beware the left behind
Chris Pond / October 11, 2018
If the vulnerable are left behind, politicians will have failed
Share with friends
  • Facebook
  • Twitter
  • Linkedin
  • Email

Comments

  1. Roland Baker
    July 11, 2009 at 20:03
    In the July 2009 print edition of Prospect, the author extended the above article to comments under the sub-head "Excessive Roaming Charges". He referred to the Directors' Remuneration Report and lamented that the shareholders' vote on the Report is advisory and not mandatory. Consequently Arun Sarin left questions about the justification for his remuneration from Vodafone unanswered. It is open to any company to resolve, by special resolution, to amend its memorandum and articles of association to report or be bound to act to a standard above the legal minimum. Usually, no one shareholder has a reasonable prospect of securing the 75% majority for such a change without the agreement of the existing board. In the case of Royal Bank of Scotland and Lloyds Banking Group, UKFI (The Treasury's public shareholding management company) has 60%+ and 40%+ of the shares respectively. Its lead would be followed by private shareholders and its message would be understood by institutions. It is unfortunate that UKFI has refused to use that power. Its pusillanimous conduct creates the very situation rightly criticised by this columnist.

Prospect's free newsletter

The big ideas that are shaping our world—straight to your inbox. PLUS a free e-book and 7 articles of your choosing on the Prospect website.

Prospect may process your personal information for our legitimate business purposes, to provide you with our newsletter, subscription offers and other relevant information. Click here to learn more about these purposes and how we use your data. You will be able to opt-out of further contact on the next page and in all our communications.

This Month's Magazine

Perspiciatis unde omnis iste natus.

Prospect is the leading magazine of ideas. Each month it is packed with the finest writing on politics, culture, economics and ideas. Subscribe today and join the debate.

Subscribe

Most Popular

  • Read
  • Commented

This proposal for breaking the Brexit deadlock deserves serious consideration

Did the SDP really split the left in 1983?

The Duel: Has modern architecture ruined Britain?

Nonsense economics: the rise of modern monetary theory

The invigorating strangeness of Friedrich Nietzsche

The Conservative Party has a problem—it’s no longer conservative

5 Comments

The impact of Brexit on services has not received nearly enough attention

2 Comments

Even if Britain stays in Europe, we need a new constitutional settlement

2 Comments

If May's deal is in flames, Labour should not seek to put out the fire

2 Comments

The naïve optimism of Liam Fox

2 Comments

About this author

JONATHAN_FORD
More by this author

More by JONATHAN_FORD

Crisis Watch: Congdon’s on the money
June 15, 2009
Crisis Watch: we are all emerging markets now
May 14, 2009
Not all black boxes survive a crash
March 24, 2009

Next Prospect events

  • Details

    Prospect Book Club—Diarmaid MacCulloch

    London, 2019-05-20

  • Details

    Prospect Book Club—Sue Prideaux

    2019-04-15

  • Details

    Prospect Book Club—Andrew Roberts

    2019-03-14

See more events

Sponsored features

  • The future of transport: taking Britain into the fast lane

  • Reforming the pension system to work for the many

  • Putting savers in the driving seat: getting the pensions dashboard right

  • To fix the housing crisis we need fresh thinking

  • Tata Steel UK: Driving innovation for the future of mobility

PrimeTime

The magazine is owned and supported by the Resolution Group, as part of its not-for-profit, public interest activities.

Follow us
  • Facebook
  • Twitter
  • Google+
  • RSS

Editorial

Editor: Tom Clark
Deputy Editor: Steve Bloomfield
Managing Editor (Arts & Books): Sameer Rahim
Head of Digital: Stephanie Boland
Deputy Digital Editor (Political Correspondent): Alex Dean
Creative Director: Mike Turner
Production Editor & Designer: Chris Tilbury
US Writer-at-Large: Sam Tanenhaus

Commercial

Commercial Director: Alex Stevenson
Head of Marketing: Paul Mortimer
Marketing and Circulations Executive: James Hawkins
Programme Coordinator: Oliver James Ward
Head of Advertising Sales: Adam Kinlan 020 3372 2934
Senior Account Manager: Dominic Slonecki 0203 372 2972

  • Home
  • Advertising
  • Contact Us
  • Privacy Policy
  • Terms and Conditions
  • Acceptable Use Policy
© Prospect Publishing Limited
×
Login
Login with your subscriber account:
You need a valid subscription to login.
I am
Remember Me


Forgotten password?

Or enter with social networking:
Login to post comments using social media accounts.
  • With Twitter
  • Connect
  • With Google +
×
Register Now

Register today and access any 7 articles on the Prospect’s website for FREE in the next 30 days..
PLUS find out about the big ideas that will shape our world—with Prospect’s FREE newsletter sent to your inbox. We'll even send you our e-book—Writing with punch—with some of the finest writing from the Prospect archive, at no extra cost!

Not Now, Thanks

Prospect may process your personal information for our legitimate business purposes, to provide you with our newsletter, subscription offers and other relevant information.

Click to learn more about these interests and how we use your data. You will be able to object to this processing on the next page and in all our communications.

×
You’ve got full access!

It looks like you are a Prospect subscriber.

Prospect subscribers have full access to all the great content on our website, including our entire archive.

If you do not know your login details, simply close this pop-up and click 'Login' on the black bar at the top of the screen, then click 'Forgotten password?', enter your email address and press 'Submit'. Your password will then be emailed to you.

Thank you for your support of Prospect and we hope that you enjoy everything the site has to offer.

This site uses cookies to improve the user experience. By using this site, you agree that we can set and use these cookies. For more details on the cookies we use and how to manage them, see our Privacy and Cookie Policy.