Editor's letter


As Credit went to press, the City of London was an unwilling host to thousands of demonstrators, many marching with a confused message of "jobs, justice, climate". Their choice of targets seemed just as muddled: one focus was the Bank of England, which - whatever one's views of its current policies - is doing its best to find a way through the economic crisis.

Although many of the Square Mile's unwelcome visitors see 'protest' as a hobby, regardless of the cause, no doubt the protestors' numbers were swelled by people unused to taking to the streets, who feel understandable outrage at the turn in their fortunes as the downturn worsens. Credit has always pursued a strong editorial line that there were excesses in the system, and that the urgent - but not precipitate - necessity of some regulatory and procedural change is clear, even if the market has to some extent corrected itself, as markets do. We would, for example, be very interested to hear from anyone who's been sold a new CDO-squared recently.

But justifiable as some level of public grievance might be, it is absurd to lay blame exclusively at the feet of the bankers. Regulators and politicians are at fault too; especially here in the UK, where the tripartite regulatory system was much trumpeted, as was Gordon Brown's claim, as Chancellor of the Exchequer, to have abolished boom and bust.

But it's not just the powerbrokers in government, the financial wizards on structured credit desks, or yield-hungry institutional investors who are to blame. For all their evident and myriad faults, the system required participation from the consumer. No-one had to take a 100% mortgage, and for every aggrieved Icesave account-holder there's a saver who one day in the past congratulated himself on getting the 'best' interest rate, forgetting that interest is a measure of risk.

It would be too much to hope that the protestors in the City gave much thought to this truth as they clashed with the police. But on April 1 who did they think was working harder to effect a recovery? The thugs smashing their way into that RBS branch near the Bank of England, or the men and women at their desks?

Matthew Attwood.

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