Banks allowed to fail in medieval crunch
Academics at the University of Reading’s ICMA Centre have identified “clear parallels” between an economic crisis during the time of King Edward I and today’s malaise.
Reading the uni’s press release Don’t panic! Banks have always failed, I spotted two clear differences. One of the academics, Dr Adrian R Bell, explained:
However, had Edward I faced today’s crisis, initially he would probably have placed senior executives under house arrest, most likely without trial, until the Government could recover as much as possible from their assets and estates. However, in his case he also subsequently realised that he would need new sources of finance and so whatever the frustrations, he might have counselled some leniency. In the 13th century, banks were allowed to fail and other banks also failed as a result. However, within a few years, other banks had grown to take their place and the banking sector and the economy recovered.
Anyone else think we’re in trouble?