More than overzealous bank regulators, governments and we should fear dumb regulators.

Sir, what is that nonsense of “Let the regulators show their teeth” July 24. It is not the role of regulators to regulate by showing teeth, but to regulate in a smart way.

And when you write “British banks entered the recession short of capital, it is fair for them to be asked to shore up their balance sheets”, remember that only happened because regulators allowed for silly low capital requirements against any exposure ex ante perceived as absolutely safe, ignoring that it is precisely that type of exposure which, because of the size it usually takes, sets of a big crisis if ex post it turns out it was not that safe.

Of course the UK banks need more capital among other because some banks in some other countries are strengthening their capital ratios, and you would not like to be left with the weaklings.

But, if the government “fears overzealous regulators could put the recovery at risk” that would happen more as a consequence of the distortions produced by dumb regulators applying different capital requirements for different assets, based on ex ante perceived risks, than because of the overall capital requirements being too high or too low.