How should labour have handled the bank crisis?

I believe the banks have been made the scapegoat by politicians not only in the UK but also around the world for their inept financial regulation, excessive government borrowing and blind optimism about asset prices:

3 main reasons for the financial mess we're in:

1. Excessive Government borrowing : The UK Government for example has borrowed excessively for many years (particularly during the New Labour Government) and has failed to disclose transparently much of this borrowing to the public, hiding the true extent of its borrowing by using ‘off balance sheet financing’. Even before the financial crisis, the true level of Government liabilities were already sky high at 129% of GDP, when one includes future PFI payments, nuclear decommissioning, public sector pensions and Network Rail’s debt.

2. Inept financial regulation: Insufficient understanding by the financial regulators around the world of systemic financial risk. The main regulator here in the UK, the FSA (a New Labour creation) was too focussed on individual firms ticking boxes to show that they were treating customers fairly rather than on factors that could lead to a broader collapse. The ill conceived tripartite structure (another New Labour creation) of financial regulation (the FSA, the Bank of England and the Treasury,) was a bureaucratic nightmare. In addition the unclear and restrictive EU Directives, left the Bank of England poorly prepared for its lender of last resort role in the Northern Rock crisis. Furthermore the inept FSA, was asleep at the wheel, it never saw the crisis with Northern Rock coming.

3. Excessive optimism about the path of asset prices and particularly the sustainability of the boom in house prices and therefore mortgage backed securities. Everything from bank strategies to the path of public spending were much too vulnerable to the property market getting in trouble. Remember New Labour's Gordon Brown's arrogant words "the end of boom and bust" http://www.youtube.com/watch?v=OU_fzCpwrNc&NR=1 . What a dangerous idiot, to encourage such complacency. There have been and there will always be economic cycles.

Conclusion:

In the aftermath of the crisis, politicians have been desperately acting to channel public anger away from themselves and onto the financial sector. This led them to promote a set of policies that might be politically satisfying but do not address the true causes of the crisis, as outlined above.

It is clear that the current wave of intensive financial regulation is harmful, costly and potentially dangerous for the world economy

They should have forced separation of the retail and casino banks. Then they should have told the casino banks that they have 5 years to repay the money lent them, and no bonus payments in any of them for those 5 years, and if they didn't pay the debt they would be allowed to fail.

But they didn't do that. Instead it was 'how much do you want? Not enough? Take some more, pay your bonus, charge the retail customers as much as you like, gamble away, after all, it is only the money of the taxpayer - your customer base - that we are using.

What about this for an idea: They could have set up a Judicial Inquiry into the banks, who did far worse things than hacking into peoples 'phones, they virtually ruined the UK and nearly made it bankrupt.

We live in a country that makes nothing so I don't see how we expect to have any money. The banks along with the service sector are just prolonging the invertible which it the financial melt down of our once prosperous economy. I would have invested heavily in industry, specialised industry like Japan or Germany are doing. Even the French have cornered a lot of markets like building most of the world's nuclear plants and they even made their own ICBM system without any help from America, whereas if you look at our ICBM system most of the engineering was do by America.

They handled it the only way possible. The financial structure of the country would have collapsed had they let the banks go bankrupt and all the investors from millionaires to wee Mrs, McDookey with £10 in her savings account would have lost out. However, with proper vigilance the crisis could have been avoided. Brown screwed up.

Labour prevented the BOE from monitoring the business of the banks. Monitoring would have stopped the rush to oblivion in its tracks.

elect the media seince totally deaf and that is your opinion too that an eected media is the best way to handle things since media is arrogant and ignores wiashes of public . perhaps an add in google adsense offering green marxist party offers one way though no requirements to join just saying environmentalism and public local cooperatives way to go local food sources.

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