All excerpts are quoted from the respective link(s).
- Economist’s View: "Why had Nobody Noticed that the Credit Crunch Was on its Way?" – So where was the problem? Everyone seemed to be doing their own job properly… And according to standard measures of success, they were often doing it well. The failure was to see how collectively this added up to a series of interconnected imbalances over which no single authority had jurisdiction. This, combined with the psychology of herding and the mantra of financial and policy gurus, lead to a dangerous recipe. Individual risks may rightly have been viewed as small, but the risk to the system as a whole was vast.
So in summary, Your Majesty, the failure…, while it had many causes, was principally a failure of the collective imagination of many bright people, both in this country and internationally, to understand the risks to the system as a whole. …
