(Easier to read threaded version!)...
It’s fair to say "no one saw the financial crisis coming”, if by that you mean that no one specifically said "in Sept' 2008, Lehman Brothers will go bust”. But I don’t think that’s what the Queen meant when she asked the question (1/8).
It’s fair to say "no one saw the financial crisis coming”, if by that you mean that no one specifically said "in Sept' 2008, Lehman Brothers will go bust”. But I don’t think that’s what the Queen meant when she asked the question (1/8).
Plenty of people (both inside and outside of the establishment) warned that something was up. They warned on specifics, and they warned about it well in advance of the credit crunch taking hold in 2007 (2/8).
This matters. It has nothing to do with bragging rights. It’s not about treating any of these people as “gurus”. In fact, so many people "saw it coming", that it’s simply not that big a deal to have expressed concerns ahead of 2007 (3/8).
The real problem is that the people who DIDN’T see it coming – who failed to accept that anything at all was wrong, or to question the build-up of debt across the global economy – are still among the most influential voices today (4/8).
To say that this crisis came completely out of the blue fits their narrative, even although it’s blatantly untrue (5/8).
Whatever else 2008 showed us, it was that our understanding of the financial system is lacking. We need to make a serious effort to address that (6/8).
Instead, we’re at risk of allowing the people and philosophies that aided and abetted the last crisis to continue running the show, and to argue that there was no alternative to the bailouts and a decade of QE, in what amounts to a massive backside-covering exercise (7/8).
That’s why the correct answer to the Queen’s question is: “Actually, lots of people saw it coming, but they didn’t fit existing theories, so we ignored them. And we’re still doing our best to ignore them” (8/8).
