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When the Old Lady slept: the Bank of England and the financial crisis

  function drawChart(){var e=new google.visualization.DataTable;e.addColumn(“date”,”Date”);e.addColumn(“number”,”BOE Assets/£bn”);e.addColumn(“string”,”Bank of England policy title”);e.addColumn(“string”,”Bank of England policy text”);e.addColumn(“number”,”HBOS CDS/bps”);e.addColumn(“string”,”HBOS title”);e.addColumn(“string”,”HBOS text”);e.addColumn(“number”,”RBS CDS/bps”);e.addColumn(“string”,”RBS title”);e.addColumn(“string”,”RBS text”);e.addColumn(“number”,”Northern Rock CDS/bps”);e.addColumn(“string”,”Northern Rock title”);e.addColumn(“string”,”Northern Rock text”);e.addColumn(“number”,”Lloyds CDS/bps”);e.addColumn(“number”,”Libor-OIS spread/bps”);e.addRows([[new Date(2007,0,2),85.2,,,5.24,,,4.14,,,8.87,,,3.97,35],[new Date(2007,0,3),85.2,,,5.2,,,4.07,,,8.87,,,3.95,35],[new Date(2007,0,4),85.2,,,5.2,,,4.07,,,8.87,,,4.01,36.38],[new Date(2007,0,5),85.2,,,5.2,,,4.21,,,8.87,,,4.03,37],[new Date(2007,0,8),85.2,,,5.2,,,4.21,,,8.87,,,4.05,40],[new Date(2007,0,9),85.2,,,5.2,,,4.21,,,9.17,,,3.99,42.44],[new Date(2007,0,10),83,,,5.16,,,4.3,,,8.98,,,4.01,49],[new Date(2007,0,11),83,,,5.64,,,4.3,,,9.17,,,4.11,24],[new Date(2007,0,12),83,,,5.8,,,4.31,,,9.17,,,4.24,36.81],[new Date(2007,0,16),83,,,5.79,,,4.4,,,9.17,,,4.22,37],[new Date(2007,0,17),79.8,,,5.79,,,4.4,,,8.81,,,4.17,38.06],[new Date(2007,0,18),79.8,,,5.65,,,5.09,,,8.81,,,4.24,42.13],[new Date(2007,0,19),79.8,,,5.79,,,5.09,,,9.15,,,4.28,42.31],[new Date(2007,0,22),79.8,,,5.7,,,5.09,,,9.15,,,4.28,43.75],[new Date(2007,0,23),79.8,,,5.7,,,4.73,,,9.15,,,4.18,44.88],[new Date(2007,0,24),79.3,,,5.51,,,4.46,,,9.15,,,4.26,41.44],[new Date(2007,0,25),79.3,,,5.51,,,4.46,,,9.17,,,4.39,41.69],[new Date(2007,0,26),79.3,,,5.51,,,4.46,,,9.21,,,4.39,42.75],[new Date(2007,0,29),79.3,,,5.51,,,4.83,,,9.51,,,4.39,42.75],[new Date(2007,0,30),79.3,,,5.51,,,4.67,,,9.51,,,4.37,41.69],[new Date(2007,0,31),78.3,,,5.51,,,5.01,,,9.35,,,4.24,39.19],[new Date(2007,1,1),78.3,,,5.51,,,4.92,,,9.35,,,4.39,41.31],[new Date(2007,1,2),78.3,,,5.51,,,4.42,,,9.18,,,4.29,43.88],[new Date(2007,1,5),78.3,,,5.51,,,4.42,,,9.18,,,4.54,44.19],[new Date(2007,1,6),78.3,,,5.45,,,4.43,,,9.44,,,4.58,46.75],[new Date(2007,1,7),77.8,,,5.33,,,4.43,,,9.44,,,4.36,52.62],[new … Continued

Most-read articles of 2014

Is the sharing economy a new form of regulatory arbitrage? That was the question posed by my most popular article this year. Published in January, my take on Uber turned out to be prescient, as the ride sharing company attracted increasing regulatory headwinds around the world. The second most-read new article is actually a pair … Continued

The Imitation Game and The Interview

Jack Good

I saw The Imitation Game last week – the biopic of Alan Turing – and it prompted me to write something about Jack Good, one of the Bletchley park codebreakers depicted in the movie.

In April 2003, while researching my unpublished probability book, I visited him in Blacksburg, Virginia. I was in New York on … Continued

Review: House of Debt

House of Debt

by Atif Mian and Amir Sufi

(University of Chicago Press 2014)

The financial crisis that began in 2007 was accompanied by a Great Recession which in Europe may have never really ended. Until now, policymakers have acted on the basis that to bring about recovery in the wider economy meant fixing the troubled banking system and … Continued

Regulating financial innovation

Regulating financial innovation

Imagine in 2004, when Goldman Sachs and Deutsche Bank structured the first fully synthetic ABS CDOs, there had been a public consultation on the social value of the products. Or if a consultation had taken place when UK banks began selling interest rate swaps to small British companies, with the banks being forced to explain … Continued

Basel in America

JPMorgan increases its op risk capital

Citigroup’s announcement last week that it would be restating its latest results downwards by $600 million to reflect the likely impact of regulatory probes into foreign exchange rigging prompted some bemused commentary. Matt Levine at Bloomberg wittily characterised it as ‘going back in time to lose more money’.

Amid the attention … Continued

Niedrigzinsangst

Wiesbaden Hof

Why can’t the ECB bring itself to stress test banks for deflation? I was thinking about this question when I remembered an episode from the past.

Just over ten years ago, I took a train from Frankfurt to the sleepy spa town of Wiesbaden. It was the sort of place where a lone taxi is … Continued