Why do people blame bankers and not Euro politicians for Europe's economic mess?

[doodab]

Good rant but who removed the regulation in the first place?
That would be Thatcher and Reagan in the 80s.
Anathema to the likes of Dodgy but true nevertheless.

I would argue that it was under influence of lobbyists, but yes, that's certainly a bit of a smoking gun. It was Clinton who got rid of the relevant bits of the Glass Steagall act BTW.

[Mich the Tester]

I was under the impression that though the pair mentioned deregulated banking, they left enough handcuffs in place to stop what eventually happened when the Golden Clown took the handcuffs off.
Didnt the septics government "force" the banks to lend money on the sub-prime market as "it was only fair". Did ours do similar.
Then the speculators realised how risky these sub prime loans were and offloaded them thus starting the rush to the bottom?

I would appreciate enlightenment if I am a bit poorly informed here.

Yes, they did, but AFAIK they did not force them to mix risky mortgages along with safe mortgages into investments that would then be sliced, diced, and glued back together again in a completely opaque fashion.

[sasguru]

Look at interest rates since 2008 and you can see quite clearly that the second statement contradicts the first.

Actually, look at the first of those graphs you posted this morning and you can see that Greek interest rates fell from over 18% in 1995 to around 10% before the € was ever introduced and about 3% more before Greece actually joined. They also enjoyed pretty good growth rates up until 2008.

I'm not sure what your point is. On average Greek rates were much higher before the Euro than after, as their eeconomy needed.
And yes every European country enjoyed good "growth" from 2001 to 2008 - that was based on cheap credit.

[sasguru]

. It was Clinton who got rid of the relevant bits of the Glass Steagall act BTW.

And AFAIK he also put political pressure on banks to give home loans to the poor and so started the sub-prime fiasco.

[Mich the Tester]

And AFAIK he also put political pressure on banks to give home loans to the poor and so started the sub-prime fiasco.

Did he force them to mix up sub-prime and prime mortgages into single investments, then slice them up and glue them back together again time and time again?

[BrilloPad]

The banking crisis (caused by sub prime) didn't last that long and had a strong but largely containable effect (in no small measure because central bankers round the world acted decisively).
The effect was largely confined to institutions and banks that had to be rescued and we were well on our way to recovery by this year.

To my mind the creation of the Euro was a far bigger economic crime, even if the intentions were good.
As many of us pointed out at the time, you couldn't shoe-horn widely disparate economies into one currency with the same interest rate.
The result was an artifical boom as countries whose economies should have had high interest rates, instead had low ones.
The low interest rate also kept the Euro lowish and ensured German exports were cheap.
So in effect the GErmans lent the PIIGs who couldn't afford it the cheap money to drive their export boom.
Similar to banks lending money to plebs who couldn't afford it.

I'm a bit bored by ecomic illiterates not seeing this, and continuing to use bankers as scapegoats.

You are right about the Euro being a big messed. But there is a bigger issue - the gap between rich and poor is getting wider reducing the velocity of money round the economy. Bankers typify this. I went to a HF seminar a while ago - all the hedge funds were asking why bankers make so much money when they are so stupid. For years bankers have let uneconomic businesses go to the wall - what is good for the goose is good for the gander.

[Peoplesoft bloke]

Throughtout(sic) history idealism has caused far more hurt than greed.

That's trite and vaccous even by the standards of here. It's the kind of populist but ultimately meaningless nonsense Mrs Thatcher used to spout - although I doubt even she would have stooped to that level.

[sasguru]

That's trite and vaccous even by the standards of here. It's the kind of populist but ultimately meaningless nonsense Mrs Thatcher used to spout - although I doubt even she would have stooped to that level.

I can give you specific instances:

Soviet Russia: the ideal utopia of communism
Nazi Germany: the ideal of German purity and dominance
Cambodia:you get the picture

The greedy capitalist economies have killed millions but nowhere near as much as the idealists.

[Mich the Tester]

I can give you specific instances:

Soviet Russia: the ideal utopia of communism
Nazi Germany: the ideal of German purity and dominance
Cambodia:you get the picture

The greedy capitalist economies have killed millions but nowhere near as much as the idealists.

This is a sort of new 'Godwin'. Anybody who dares to criticise capitalism must be some raging communist or fascist who wants to send a millions of people to their deaths in gulags, extermination camps or muddy empty rice fields. I propose to call it a 'Godlose'.

[Peoplesoft bloke]

I can give you specific instances:

Soviet Russia: the ideal utopia of communism
Nazi Germany: the ideal of German purity and dominance
Cambodia:you get the picture

The greedy capitalist economies have killed millions but nowhere near as much as the idealists.

I wouldn't (and of course can't) argue with the contention that these evil idealists killed a lot of people, but the idea that there's any kind of superior morality and demonstrably less harm in greed seems insane to me. Just because the deaths were concentrated into periods of history in evil regimes doesn't automatically make their numbers higher than those "killed by greed".

Just because people die of starvation in Africa or have been dying in the US for years because they are too poor to afford healthcare doesn't mean they haven't died at the hands of the greedy idealists.

In any case, as I said, it's an unprovable vaccuos contention - just sloganeering really IMHO.