Monday, 29 September 2008

The "suddenly silly" explanations of the credit crunch

I find it difficult to accept the explanations of the current credit crunch which essentially say that bankers in the world's financial centres have suddenly started behaving foolishly, making huge imprudent loans. The argument seems to be that they used to be smart but today they are silly.

It certainly could be the case that people have changed. But the world economy has changed so quickly that it seems likely that systemic or structural changes in the latter are at least among the major contributory factors to the credit crunch.

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