The battle between banks and nation states is shaping up as something that lies between a phony war and a rout.
The bald facts are that three years after the crisis in which banking almost brought down the global economy, the biggest banks are bigger, more global and more entrenched in their positions, courtesy of a now all but explicit government guarantee.
The author, James Saft, goes on to predict that the next banking crisis will be larger than the last. You can read the rest of the article via the Financial Chronicle: Big winners in crises: The banks.
This is why, with like-minded thinkers from business, banking and academia, I spent time setting up The Cobden Centre: the design of the present banking system is not only a great source of injustice in the world, but the problems created by it are growing.
It is absurd that we do not apply the principles of free markets to money and banking. Property, contract, competition, unhampered entry and exit and, crucially, bearing one’s own commercial risks are some of the institutions and principles which enable a dynamic, open and flourishing society. As Cobden pointed out, the monetary system should not be positively managed by authority:
I hold all idea of regulating the currency to be an absurdity; the very terms of regulating the currency and managing the currency I look upon to be an absurdity; the currency should regulate itself; it must be regulated by the trade and commerce of the world; I would neither allow the Bank of England nor any private banks to have what is called the management of the currency…
Whether we can rediscover and apply the principles of a free society in relation to money and banking will determine the course of our lives for a long time. Please join us in our efforts by becoming a Cobden Centre subscriber here.