Bank governor slams ‘City’ errors
May 1, 2008
Mervyn King, governor of the Bank of England, did not mince his words in discussing the reckless investments in complex financial products by leading financial institutions in the lead-up to last summer – and how these had contributed to the ongoing credit crunch in global markets.
“They [complex financial instruments] may have looked very clever, but actually they were based on some very poor assumptions,” he told the committee of MPs.
“And the managers of those institutions, who probably knew far less about those instruments than they should have done, will know in future that if they want to keep their jobs they will have to have better control over the design of those instruments.”
King said today that in some ways the City’s economic dominance was regrettable.
“I do think it is rather unattractive that so many young people when contemplating careers look at the compensation packages available in the City and think that these dominate almost any other kind of career,” he said.
“That is not an attractive position to be in when such a high proportion of our talented, young people naturally think of the City as the first place to work in. It shouldn’t be. It should be one of the places, but not the only one.”
Spot on Mervyn. We the common people salute you!
