Small line of customers (presumably anxious investors and savers) outside a branch of Northern Rock – a Mortgage specialist and a top UK mortgage lender – in North Street, Brighton, East Sussex. The business (a former “savings and loan” type Building Society which was demutualised in 1997) has been affected in part by problems in the US “subprime” lending market. Picture taken late on Friday afternoon on 14th September 2007. (Photo credit: Wikipedia)

This is an excellent, hard-hitting, editorial from the Observer newspaper on the latest UK banking scandal. Check it out!

Banking scandal: our whole society has been warped by the City | Observer editorial | Comment is free | The Observer.

I very much endorse the editorial conclusion, namely:

The values, culture and practices of finance, as they have developed since the “Big Bang” reforms of 1986, must be torn down, and a smaller, humbler, simpler world of banking built in their place.all

Personally, I think that the big problems in finance started when President Clinton repealed the Glass Steagall Act, which had strictly segregated investment and retail banking since the thirties. Following financial crisis of 2008, Germany and France wanted much stricter regulation but this was resisted by both the US and the UK.

So for me, the Observer’s conclusion needs to be applied globally.

What do you think?