So the game is up -- for you, and for us. It was all of you in America, with us here in Britain hanging grimly onto your coat tails, who saw the answer to the world's problems as free enterprise, the market, capitalism. Like you we spent and spent, and borrowed and borrowed; and like you we rode the roller coaster of continual economic growth.
As we borrowed more, the prices of assets like housing and basic commodities raced ahead. To buy them we borrowed more, then we could buy more, and round and round we went, with the bankers happily raking in their bonuses and ensuring that the carousel continued to whirl.
As Communism collapsed, the whole world climbed aboard. Russia sold us her minerals. China provided us with billions of dollars of cheap goods, and then lent us the money so we could all buy even more. They boomed, we boomed. It was a magical and intoxicating ride.
And now it has all stopped, now we are examining the wreckage of that magical circus, a couple of things have become clear.
One is that the world needs regulations to govern the free market. Those masters of the universe who strode around our stock exchanges pocketing their billions of dollars, will now have to abide by a stricter set of rules. They cannot be allowed to play their games with derivatives and those other weird technicalities with which they dress up their gambling. It is our money they are gambling with.
I had a a look at my finances the other week, and a great lump of that carefully saved money, invested as directed by those who claimed to know best, has simply gone. So in future, the gambling has to stop.
And secondly, since we both have to finance our banking systems with public money, and indeed will continue to do so for decades to come, the banks will have to obey a new and stricter code of conduct. And those new rules will have to cover the whole world. If there is one thing recent events have shown, it is that we now have a global economy. All of which of course means bureaucracy, and officials and regulations and the dead hand of the state interfering in our financial affairs. I don't enjoy the prospect. But I don't see the alternative.
By Peter Allen