John Kay

The elevation of credibility into a central economic doctrine has turned a sensible point – that policy stability is good for both business and households – into a dogma that endangers stability.

On the 25th April, John gave a speech at the Foundation for Science and Technology on ‘Systemic Failure in the Banking System’, which you can listen to on the FST website. Other speakers included, Andy Haldane, executive director of financial stability at the Bank of England, and Martin Jacomb, former deputy chairman of Barclays.

When we make hiring decisions, or construct risk maps, or undertake investment appraisals we complete templates, the purpose of which is not to help us manage or decide but to rationalise what we already believe we know.

Keynes famously advocated reducing unemployment by employing people to dig holes and fill them in again: today it would be enough to employ them to fill the potholes that are already there.

Governments will in the end always put voters ahead of prior commitments or external obligations. That democratic imperative has costs and benefits – but, overall, the benefits of popular accountability far exceed the cost.

On the 7th February, John took part in an Intelligence Squared event entitled, ‘What hope for the economy?’, in which Evan Davis grilled a panel of eminent economists and leading figures from the world of business and finance. They discussed the economic crisis, banking regulation and the future of capitalism. You can watch the full debate here.

If the eurozone had quickly recognised defeat in Greece, it would have suffered a manageable failure and learnt an important lesson for the future. Instead it has followed the martingale.

As the eurozone crisis deepens and political leaders flail in the face of the huge debts that have left financial institutions and member states teetering on the brink, it is important to understand how we got here if we are ever to figure a way out. In 2005, well before the financial crisis, when the [...]

A semantic confusion leads us to use the word market to describe both the process which puts food on our table and the activity of gambling in credit default swaps. That confusion has enabled people to claim the virtues of the former for the latter.

John discusses credit default swaps on the today programme. Listen here.