John Kay

Plurality and diversity are generally sources of stability – in banking as in nature.

The common sense that says “I know the difference between a Cornish pasty and a ham sandwich when I see it” is appealing, but we would rightly find it unacceptable that the decisions of a tax inspector should be based on the principle that he knows what to tax when he sees it.

The interim report of the Kay review into the effect of UK equity markets on the competitiveness of UK business, was released yesterday. It summarises public responses to the call for evidence, and draws out the issues that will be considered in the second phase of the review. Read it here.

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.

Investment banks have declined, while investment bankers have grown in power, influence – and remuneration. This is perhaps the most startling of the many consequences of Big Bang.

On the 18th October John gave evidence to the Treasury Committee on the proposals put forward in the Independent Banking Commission’s Final Report. Also in attendance were John Hitchins, PricewaterhouseCoopers, John Grout, Association of Corporate Treasurers, Matthew Fell, CBI and Peter Hahn, Cass Business School. Watch full coverage here.

Since there are many issues in public debate, attention to any one is necessarily transient. The attention of vested interests to their own concerns, however, is permanent.

The jobs and growth the bankers claim will be in jeopardy are their own: the pressing needs of the real economy point not to delaying change, but to implementing it as speedily as possible.

The turmoil following the collapse of Lehman Brothers three years ago was an opportunity to
reform the world’s financial system. It was missed, and the new crisis promises little change.

It is more effective to give incentives to serve consumers well than to supervise the way in which they are served.