7803
UK Financial System Still Weak
World Economy

UK Financial System Still Weak

Mervyn King, at the helm of the Bank of England throughout the financial crisis, has said the banking system may not survive another crisis.
“I don’t think we’re yet at the point where we can be confident that the banking system would be entirely safe,” he told Radio 4’s Today program, according to a BBC report Monday.
His warning comes despite rules forcing banks to hold more funds to guard against the risk of a future downturn.
“I don’t think we’ve really yet got to the heart of what went wrong,” he said.
Lord King, who retired 18 months ago, said the problem of imbalances between different economies globally had not yet been solved. He also said the UK’s historic low interest rate could not continue. The UK’s interest rate has been held at a record 0.5% for more than five years.
“The idea that we can go on indefinitely with very low interest rates doesn’t make much sense,” said Lord King. However, he warned that if interest rates rose now, it “would probably lead to another downturn”.

  Exciting
Lord King, who was guest editor of Radio 4’s Today on Monday, played a pre-recorded interview with former US Federal Reserve President Ben Bernanke during the program.
During the interview, Lord King said the financial crisis was “exciting” to work on. “It was exciting and it was fascinating, and it was the sort of problem that we had trained to deal with over many years,” he said.
However, the use of the word “exciting” to describe the financial crisis drew complaints from listeners, and Lord King later clarified his language: “I wanted the team around me who were working all hours of the day and night to feel this was an experience they would look back on and think not just was important for the country as a whole but they actually enjoyed it.
“So I worked very hard to make sure that there were moments of laughter,” he said.

 

Short URL : http://goo.gl/gAVRDr

You can also read ...

Innovation, Technology Should Boost Hong Kong Economy
Innovation and technology will become profitable in Hong Kong...
Annual expansion in the second quarter fell to 4.5%.
Malaysia cut its full-year growth forecast and reported much...
Government data shows the number of jobs created in July fell to the lowest levels in over eight years.
South Korea’s ranking officials revealed a disparity in their...
Canada Inflation Surges
Canada’s inflation rate surged to 3% in July, fueled by rising...
As technological progress makes people richer in terms of many basic goods and services, it may be inevitable  that more human activity is devoted to zero-sum competition for available income and assets.
Across the global economy, the potential for automation seems...
Trade War Won’t Dent China GDP
Analysts are trying urgently to evaluate the potential impact...
Italy to Launch New Infrastructure Plan
The government will launch a plan aimed at making Italy’s...
Amazon to Challenge TiVo With Live TV Recorder
Amazon.com Inc. is developing a new device that records live...

Trending

Googleplus