And I\’m amazed that The Guardian of all places publishes it:
Politicians and the media continue to refer to the economic downturn as being the result of a financial crisis. This is wrong. We have 15 million people out of work because the housing bubble that drove the economy since the last recession finally burst. The financial crisis may have been good entertainment for those who like to see huge banks collapse, but it was a sidebar. The real story was the rise and demise of the housing bubble.
Those who claim that the real problem was the financial system and its faulty regulation can be disproved with a single word: Spain.
Worth reading the whole thing.
And as he says, if it wasn\’t the financial markets that caused the problem but the housing market then the action required to prevent it happening again is reform of the housing market not reform of the financial system.
In the UK that might be along the lines of an LVT, or a relaxation of planning permission rules (for it wasn\’t the value of houses that bubbled, it was the value of the right to build on a piece of land that did….the value of planning permission).
All this about FTTs, Robin Hood and reining in the greedy bankers and their bonuses is a side show. Just the opposite of Naomi Klein\’s thesis. Statists using a crisis to advance theor cause.