The Lib Dem newsfeed on Monday included this - Urgent need for review of banking system - Cable:

Urgent need for review of banking system - Cable
31 July 2006

Responding to the news that HSBC has posted pre-tax profits of £6.7bn, Liberal Democrat Shadow Chancellor, Vince Cable MP said:

"There is a serious question mark about the level of profits in the banking sector. In March 2000 the Cruickshank report provided a serious set of broad recommendations for action, yet the Government’s failure to act has meant that we are in the worst of all worlds.

"Piecemeal and ad-hoc investigations by the OFT are being relied upon too heavily while the level of charges and levels of service deteriorate.

"With soaring profits seemingly unrelated to the standard of customer service, whether it be overdraft charges or cheque clearing times, there will be increasing pressure for a windfall tax on banks.

"We do not believe that is the right way forward. There is now an urgent need for an overall review of the banking system, a Cruickshank II, whose recommendations must be more seriously investigated."

Now okay, I know he's on about profits from charges - that was what Cruickshank was all about wasn't it? But if we're serious about "reviewing the banking system" we're opening a great big catering sized can of worms. What about their effective monopoly of the creation of credit? About their protected profits from lending with not one, not two, but three forms of security - income, a charge and ultimately the protection of the central bank from their own mistakes.

Somehow I suspect that seignorage reform is not anywhere on Vince's radar. I hope we can change that! The two big monopolies that stifle truly free trade and give inequitable power to the few who can afford more than they need, of land and credit creation, are coming into play together.

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