The Queen’s question: ‘why did no one see it coming?’

Ann Pettifor: 29th January, 2009

On Monday, 2nd February, the London-based Guardian is organising an event at their imposing new building in York Way. There the Queen’s question will be posed: “Why did no one see it coming?”

This event is now sold out.   The panel features:Nouriel Roubini, Professor of Economics, NYI; Chairman, RGE; Niall Ferguson, Laurence A. Tisch Professor of History at Harvard University and author of The Ascent of Money; Ann Pettifor, Fellow, New Economics Foundation; Rt Hon John McFall, Chairman, House of Commons Treasury Committee. It will be Chaired by Larry Elliott, economics editor, the Guardian.

Any useful hints, sources and references from readers of this column would be gratefully received…especially any howlers. Particularly looking for optimistic predictions made a year or two before ‘debtonation’ exploded on 7th August, 2007.  Cheerful predictions made by economists post August, 2007 would also be welcomed.

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5 comments to The Queen’s question: ‘why did no one see it coming?’

  • Charles Wheeler

    The biggest lie being perpetrated about the crisis is that nobody saw it coming – hence nobody can be blamed for not trying to

    prevent it.

    In truth, the list of those who predicted what was likely to happen is legion. The derivatives trading of firms like JP Morgan

    was causing concern way back in the 1990s. Brooksley Born saw the writing on the wall in the late 90s. By 2002 Warren Buffet had given a good run-

    down of what was in store.

    Unfortunately, it was in the self-interest of many not to see it coming. Alarmingly, a number of those who were

    actively engaged in paving the way to financial armageddon are now advising Obama (Rubin/Summers et al). The whistle-blowers are stiil being

    ignored, while the bankers and regulators that caused the collapse remain seated at the top table.

  • Marcel Coderch

    As quoted by Adair Turner, Chairman, FSA in:

    http://www.fsa.gov.uk/pages/Library/Communication/Speeches/2009/0121_at.shtml

    The IMF’s Global Financial Stability Report of April 2006 stated that [Exhibit 13] ‘the dispersion of credit risk by banks to a broader

    and more diverse set of investors, rather than warehousing such risk on their balance sheets, has helped to make the banking and overall financial

    system more resilient’. It noted that this dispersion would help to “mitigate and absorb shocks to the financial system” with the result that

    “improved resilience may be seen in fewer bank failures and more consistent credit provision”.

  • john fletcher

    Hope the video of this extravaganza is going to be posted on the Web for us plebs unable to enter the Portals of the Immortals.

  • john fletcher

    Didn’t it take a longtime in the 30’s for the New Deal to get really underway. Roosevelt started by advocating a balanced budget. He

    moved very cautiously to begin with because of the enormous latent conservatism of the American people.

    It was only when the sheer horror of

    mass unemployment and poverty sank in to the people as a whole that he was able politically to start moving. Wasn’t it 1935 or so before there was

    any major bank reform?

  • Thank you Marcel, John and Charles for these….Especially grateful for the ‘dispersed risk’ quote from the

    IMF….but there were plenty saying that not so? Have more from the IMF; Mervyn King, Alan Greenspan..but they are all the official sector…what

    about university academics?…it seems there were very few academics working on the finance sector, and the international financial architecture?

    And predicting that all was stable…? and the Bretton Woods II debate of a couple of years ago?

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