It would be then the time of the radicals

The establishment of a new global financial regulation, pursuant to the decisions of the g-20, advance groped and differently according to the country. The science of this globalized finance is still well ignorant, there is no consensus on the issue between the policies, or between economists. At the same time, banks still larger that pre-crisis found record profits, new financial inventions escape surveillance (blackpools), "carry-trading" departed, flooding the planet of liquidity, all this in a general context where the "imbalances" between large areas are not correct, below it. Finally, on both sides of the Atlantic, the financial lobbying are manoeuvring to the least possible. In short, monte fear that all this leads to almost nothing.

Hence the revival of the radicals. And not least because their ranks include Paul Volcker, former boss of the Fed, and Mervyn King, the current Governor of the Bank of England. The first request a return to the distinction of 1933 between commercial banks, hyper - controlled, and investment banks, free but that the State would die if there are problems. The second proposes to cut the banks into pieces so that they represent "systemic bankruptcy threat. The general idea of radicals is that it will never happen to tame finance and is the only way to reduce the danger of limiting the size in one way or another.

These radicals are not heard. No country wants to have more than "small" banks. In addition, large enterprises need of complex products, for example coverage of Exchange. Financial innovation is useful. But, and this is the response of the moderates, to be difficult, expensive, or even fatal, taken excessive risks. Should the taxpayer no longer has to pay the inconsistencies of the banks that they take the place for said and that it reduces their catch of risks.

The g-20 instructions detail this device: increase the capital of the institutions, better control the liquidity, expand surveillance "hedge-funds", rebuild credit rating agencies, regulate derivatives, so that bonuses are more shoot - to crime. On paper, everyone agrees that this is common sense and rather fast enough since all must be presented late 2010 and applied end of 2011.

Yet, over the weeks, rise queries and a big concern. First question: the controllers. The IMF, the Bank of International Settlements (bis), the Council of stability, national regulators, central banks: who does what The distribution is vague and fluctuating. In the United States, Barack Obama is Fed to the centre but the Congress holds back. In the European Union, there is still no federal agency. Second question: own funds. A fundamental divergence is dug between the Americans, who want to use large simple strings to contain banks, and the Europeans, who want subtly tie them according to trades. The Americans want, for example, levying "systemically" major banks, the Europeans, that this would penalize, respond that the danger is not the size (Northern Rock, which sank, was a small Bank).

Without reaching agreement, the concern was born to an inoperative final schema: devices very complicated, too heavy and therefore bypassed. A schema, then, that would be against the Europeans. Good students, they would only apply the guidelines to the letter while Americans and Britons to suggest (as on the bonus) and the Asian ignoreraient them completely. Hence the proposal made by Jacques de Larosière, missi dominici European create GFW, a global organization of finance, to which countries adhere and which, as the WTO, would impose universal laws and could punish.

Too heavy and not universal: If such was to be the new regulation, finance escape and nothing would change. It would be then the time of the radicals.