Brilliant, isn't it?
If I'd been there, that's almost exactly what I'd have wanted to say to Brown. I may have used a few more swear words, though, and I'd probably have taken something to throw at him as well...
Long rambling political theorising based on very few facts follows. Please feel free to ignore it if you like... :
There are a fair number of Americans on this forum; and I guess that nearly all of the time, British politics holds very little fascination to them. However, our Prime Minister (also known as the Prime Mentalist, as there is some question of his sanity) spent most of 2008 blaming you Americans for the "credit cruch". "This crisis, which started in America" he's been quoted as saying, several times... although oddly enough, he changed his tune somewhat when he addressed Congress the other week. Hmmm.
It's broadly accepted that US "sub-prime" mortgages are to blame for triggering the collapse. What's interesting is how we got there, and why...
2 US policies interacted to allow the problem to evolve: The repeal of Glass-Steagall in 1999 allowed lending banks (building societys, in UK parlance) to do investment banking stuff. This allowed them to create "derivatives" of mortgages, which could be sold to other investors, bringing in loads more cash, which could be loaned out, which could be "derivatized", sold, loaned, rinse, repeat[1]. Hands up anyone who can spot the house of cards here...
Now, all would have been well (precarious, still, but probably OK) if it weren't for the US "social charter" (I think it's called). This basically rewarded the banks for lending money to the underprivledged, those whom life was treating badly. In other words, really risky people to lend money to - not because they're bad, per se, but because there's a high likelihood that they wouldn't be able to pay the mortgage... hence, the toxic debts.
Now.... what lead to the repeal of Glass-Steagall? Well, rumour has it that when Gordon Brown became chancellor in 1997, freeing the Bank of England from Government control, and setting up the toothless FSA regulator (which recently has proven to have been useless), causing a significant deregulation in UK banking -- the money started flowing into London - thick & fast. Indeed, London became THE financial place to be, it was even more attractive (the rumour goes) than Wall St. Hence Glass-Steagall; the US wanted their "edge" back; if those bills were effectively repealed, Wall St. would dominate again, and so - we arrive at the interesting, and slightly shocking conclusion, that just possibly Gordon Brown is actually the man responsible for causing the current credit crunch...
[1] Britons with long memories may notice that this bears a striking resemblance to the Lloyds re-insurance scandal of the early-mid '90s which damn near brought Lloyds down, and actually bankrupted many of the so-called "Names", the people at the bottom of the food chain who actually had to pony up the money to pay insurance claims.
