What was once hailed as progressive financial reform benefiting the growth and development of key financial markets worldwide needs to seen for what it really is, an unmitigated disaster. Not that this would be admitted by those who have benefit from financial 'reforms' and the slew of associated policies that these ushered in to the benefit of the high risk 'gambling' community challenging the very sound basis of traditional economic structures by which politically stable economies could approach growth and sustained takeoff soundly based. We sacrificed sound economics to the dictatorship of right wing politics that ultimately threatens a severe implosion and deflation of economic values worldwide. How long can patches be stuck on this failed balloon design for the benefit of those harnessed to the power of credit creators. We are riding on the backs of teams of wild horses that will lose steam and collapse below the clouds of their own indifference.
Instead of good practices, the Big Bangs have had central banks roll in predatory structural reforms that lead to currency and monetary crisis after crisis running from Mexico, Brazil, Argentina, Thailand and the rest of Asia, United States, The UK, Greece, Italy, Portugal, Iceland Ireland. Start eating shit style political policies and parade them as sound economics and your economies turn into shit style economies without the benefit of sound politics. You watch a fair income distribution and full employment get replaced with skewed income distribution and job search forever. You grow too fast and you overprice and watch the market fall, so you do nothing but provide liquidity forever. Man your economy is in the shit hole of the worst form.
The Big Bangs of Financial Markets were the death knolls of sound financial and economic policies and have resulted in income distributions that threaten to produce political revolutions that will make the French Revolution over two hundred years ago seem like a picnic. The problem with financial reforms is that they destroyed the solid links between savings and growth in the stable economies of the Western World with the economic conditions that brought on World Wars One and Two. If we are to avoid the flights into economic policy fantasy that characterise conditions that create massive social instability and the preconditions to Demand for a major World War, we need to reverse the direction taken with the Big Bangs and rebuild the key relationships between work and reward, savings and life cycle economic optimisation, presently missing.
The new policies would separate away short term banking and gambling finance from the basic economic requirements for savings and pension funding. Rather than use the money creation process as the source of finance for acquisitions and stock market success, these should be based on growth of income and profitability long and short term. In essence, we direly need a return to traditional economic structures otherwise the brave new world won't be one worth living in.