And FT too clings to blissful oblivion... Shame on you!

In November 1999, in an Op-Ed in the Daily Journal of Caracas, I wrote the following: “The possible Big Bang that scares me the most is the one that could happen the day those genius bank regulators in Basel, playing Gods, manage to introduce a systemic error in the financial system, which will cause its complete collapse” 

And January 2003, while being an Executive Director of the World Bank (one of 24) you, the Financial Times published a letter I sent you which ended with: “Everyone knows that, sooner or later, the ratings issued by the credit agencies are just a new breed of systemic errors, about to be propagated at modern speeds” 

And in 2007 the Big Bang happened, not because of an A-bomb but because of the AAA-bomb, those capital requirements for banks that orders reasonable bank equity when the perceived risks of default are high, but allow for unreasonably low bank equity when the ex-ante perceived risks are low. 

But now, Sir, in October of 2012, you end the editorial “Markets cling to blissful oblivion” October 6, with “Liquidity… cannot alone fend off the guns trained on our economies”… but you still insist, God knows why, on being oblivious to the fact that the most dangerous gun trained on our economies, are the regulatory distortions caused by capital requirements based on risks, and as weighted by bank regulatory bureaucrats. 

Shame on you!