Now that my bank is partly owned by us

…can I expect any changes?

The truly unprecedented scale of the banking crisis has been breathtaking. At the centre of it all, I look at my bank (and others) and wonder who is to blame for it all. I gather the Tories are planning, in good time, to heap all of this at Gordon Brown’s door.

But it ain’t that simple…

Deregulation and liberalisation of banking has been going on since the Thatcher years. Dismantling a raft of restrictions on banks and building societies seemed like a great idea. But how many demutualised building societies are still going strong today? There are some in our party that like to believe that economies and markets can almost always be left to their own devices. What has transpired has proved otherwise.

The big problem with fractional reserve banking is that the more risk you take – the more you stand to make. Unless governments set boundaries, there is always a danger that the bubble will burst again. We are all going to need to take a long hard look at how banking can be regulated in the future. Liberals will have to strike the right balance between competitive freedom and the recognition that banks aren’t always as prudent as is necessary for a healthy, stable economy.

Next time I go overdrawn, and get charged by my bank for not being ‘sufficiently careful’ with my finances – can I expect a more sympathetic hearing?

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