FSA: Deal with the fundamentals
Lord Turner, head of the Financial Services Authority, delivers a speech arguing for the need to move beyond the “demonisation” of bankers:
“There were some absurd bonuses for people not doing terribly clever things but simply taking excessive risks with other people’s money”
“Far more fundamental than these surface phenomena… was an entire philosophy of market regulation which was embraced by policy-makers throughout the world… which failed to identify or adequately address the dangers… and which far too confidently relied on supposedly efficient and rational markets to magically produce results”,
“We do need appropriate regulation of bonuses to reduce incentives for excessive risk-taking.
“We also need to move beyond the demonisation of… traders.
“Ill-designed policy is a more powerful force for harm than individual greed or individual error and we really need to address the fundamentals of what went wrong.”
