March 24, 2014

FT, you need more journalistic boldness to live up to your motto, “Without fear and without favour”

Sir, again you publish the “Boldness in Business” extra in which you celebrate boldness. And yet you are still not been able to write about that absurdly misguided and extremely dangerous cowardness that has taken over bank regulations.

For the umpteenth time… current risk based capital requirements allow banks to earn much higher risk adjusted returns on equity on assets perceived as “absolutely safe” than on assets perceived as “risky”.

That not only stops banks from giving adequate access to bank credit to those who most need it, like medium and small businesses, entrepreneurs and start ups, but it also guarantees that banks will, against much too little capital, be building up dangerous exposures to “infallible sovereigns”, to “safe” sectors as housing, and to the AAAristocracy.

What is keeping FT from putting forward this matter for discussion” Might it be some lack of boldness among those who so proudly proclaim “Without fear and without favour”?