Sweden, ask Stefan Ingves a simple question before granting him more powers.

Sir, I refer to Richard Milne’s “Sweden central bank chief [Stefan Ingves] gains forex intervention powers” December 5.

And “Andreas Wallstrom, an economist at lender Nordea, called Mr Ingves’s new powers “truly sad” because currency interventions often failed to bring about the intended result.”

Mr. Ingves, as the current Chair of the Basel Committee, is one of the experts on interventions that fail to bring about the intended results.

Take just the case of regulations that force banks to hold more equity against what is perceived as risky than against what is perceived as safe, and which dangerously distorts the allocation of bank credit.

The result, dangerous bank exposures to AAA rated securities and Greece and equally dangerous lack of exposures to “risky” SMEs and entrepreneurs.

So just ask Mr Ingves the following:

Sir, would you be so kind so as to provide us with one example of a major bank crisis that resulted from excessive bank exposures to assets that were perceived as risky when placed on the balance sheet of banks.

If he cannot answer, should that not be a sufficient indication he might have no idea about what he is doing?

Regulators assigned a 20 percent risk weight to AAA rated private sector bank assets and a 150 pecent risk weight for similar assets rated below BB-. I can think of many instances were bankers were lulled into a false sense of security by good credit ratings, but I cannot for my life imagine bankers building up excessive exposures to something rated below BB-. Sir, can you?