The financial system has stood right at the edge of a precipice on several occasions recently. Regulation has failed to prevent this and so-called free markets and some of their proudest defenders are looking to governments to rescue them. The fiercest debate is now under way about what should be done, and includes calls from the private sector for massive intervention.
One of the leading thinkers in global banking, George Magnus, who is a senior economic adviser to UBS Investment Bank, says: “The consequences of non-intervention in the financial system is to invite such systemic financial failure that you would be inviting a nefarious economic outcome which would be politically, and from a democratic point of view, not acceptable.”
