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Dr Mike J Smith
Kingston University

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February
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Financial Markets

Fri, 27 Feb 2009

Nothing to do with GIS, but the collapse of the financial markets has been making such headlines, even more so in the UK with the ex-CEO of the Royal Bank of Scotland being given a nice tidy 16M pension (you read that right) which he can take from age 50 entitling him to a rather pleasant 650K per year for life. And that's before any other pensions he has.

In the UK I think it is probably fair to say that no single entity, organisation or person engineered or precipitated the collapse, but rather everyone was complicit at all levels. The government (and in particular the then Chancellor Gordon Brown) was hungry (or greedy?) for income from financial markets and left regulation to a "light touch", the Financial Services Authority played ball, the banks followed the mantra of "pile it high, sell it cheap" believing they could maintain pyramid type selling returns on their investments and the general public.... they took as much as they could get for as little as possible with scant regard for the consequences. OK, so it's a gross generalisation but there is a considerable amount of truth. And it does feel a bit like a "them and us" situation; we've got the money and no matter how bad we cock up, we get to keep it all and more.

The apologies by the banking bosses several weeks ago to the commons select committee was somewhat hollow and certainly it was on "their watch" that much of this happened. I personally think they deserve a life sentence for the pain, suffering and havoc they have caused but this doesn't go far enough. What they should really get is 30 years of community service making best use of their skills. So that means, for example, for Sir Fred Goodwin, managing something like a hospital trust, on a fixed salary, but as #2. He doesn't make the decisions, but asks permission first. They owe a rather large debt (both real and metaphorical) to society.

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