European flag outside the Commission (Photo credit: Wikipedia)
This is an excellent article by Oxford economist Simon-Wren Lewis, published in his Mainly Macro blog. This is a STRONGLY RECOMMENDED READ. Check it out!
mainly macro: UK banks and the productivity puzzle: it may not just be about limited lending.
I agree with many of Wren-Lewis’s observations here. Certainly small business are still struggling to obtain finance at pre-2008 levels. Also property developers are struggling to find finance for good quality proposals.
In my view, the UK banking sector is an oligopoly and not necessarily working in the UK\’s national interest; it’s still geared towards enormous bonuses that are likely to outlawed by the European Commission next year. I would like to see the big banks broken-up, with increased competition from foreign banks.
Perhaps, the European Commission will have the resolve to tackle the big banks where the UK Government failed?
Any thoughts?
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Sadly I do not think Dr Alf’s wish will come true because the European Commission is told what to do by the people who control the banks, just as UK Government’s are and have been since the early 1800s.
Outlawing bonuses will do nothing because the Masters of the Universe will just demand bigger salaries.
The solution is Crowd-sourcing, Peer to Peer lending, and the banks being replaced by technology companies creating different means of exchange.