Guest editorial

Abstract

The political economy of the rise, fall, and rise again of securitization One month into his new function as governor of the Bank of England the Canadian citizen, former governor of the Bank of Canada, acting chair of the Financial Stability Board (FSB) and ex-Goldmanite, Mark Carney, made his first public speech, optimistically titled: Crossing the threshold to recovery (Carney, 2013). While the content of Carney's speech left only a weak trace on the collective memory of the British public, what apparently did make an indelible impression on the public's consciousness was Carney's looks. No respectable media outlet failed to comment on Carney's swanky presentation and his immaculate sartorial acumen. It was widely seen to herald in a new era at the Bank of England, after the rule of the stiff, stuffy, and rather academic Mervyn King.Two months later, it even earned Carney an appearance in the Financial Times (FT) fashion section, where he figured in a piece dedicated to the rise of the so-called bag man or men bearing bags instead of cases. According to the fashion editor, Carney was one of a new phalange of fashion conscious public figures who had replaced a traditional attaché case for a "boxy, soft-sided grey bag, trimmed in black, with a large side pocket and extralong handles" (FT, 2013). For the FT, this placed Carney alongside such soccer luminaries as David Beckham and Christiano Ronaldo, the American actor Liev Schreiber, and the Australian actor Hugh Jackman.This episode clearly talks to the "superstar" status that central bankers have gained during the arc of the crisis, with Ben Bernanke of the US Federal Reserve, "super"-Mario Draghi of the European Central Bank (ECB), Jens Weidman of the Bundesbank, and Mark Carney blazing the trail. There is now a growing sociological literature on the increasing political power of central bankers (

Consumer Credit in Comparative Perspective

“…In Japan and South Korea, for instance, the move away from corporate customers did not happen (Fuller 2015). Regulation, too, played out differently in different countries: interest rates are capped in Germany and France, but not in Denmark or Austria (although usury is regulated in a variety of ways, see Maimbo and Gallegos 2014); consumer debt is securitized in Spain but not in Italy (Aalbers and Engelen 2015); and in Vietnam, automation of teller services turned out to be too expensive and had to be halted (Rona-Tas and Guseva 2014: Trumbull's (2014) historical comparison of consumer credit in France and the U.S.…”

Sustainability and the Governance of the Financial System: What role for full reserve banking?

“…Securitization is promoted as a solution for the European credit crunch, supported by 'cosmetic exercises to render securitized assets simple, transparent, and standardized' (Aalbers andEngelen, 2015: 1600). At present, the prospects seem bleak.…”

“…Despite the economic crisis and the increasingly urgent environmental crises, the interests of finance are still extremely powerful. For instance, it may be a barrier to reforms that both home owners and pension holders, who have invested in securitized assets through the funds, have an interest in rising housing valuations (Aalbers and Engelen, 2015). Securitization is promoted as a solution for the European credit crunch, supported by 'cosmetic exercises to render securitized assets simple, transparent, and standardized' (Aalbers andEngelen, 2015: 1600).…”

“…As an illustration, shadow banking is now reframed as resilient market-based credit intermediation, and light-touch oversight is recommended. Securitization is promoted as a solution for the European credit crunch, supported by 'cosmetic exercises to render securitized assets simple, transparent, and standardized' (Aalbers andEngelen, 2015: 1600). Before the crisis, financial elites were powerful for many reasons.…”

“…Considering the electorate, the power of finance relies on a long period of mass financialization with the spread of owner-occupied housing and pension funds. For instance, it may be a barrier to reforms that both home owners and pension holders, who have invested in securitized assets through the funds, have an interest in rising housing valuations (Aalbers and Engelen, 2015). Counter-trends are also visible, particularly in the USA where student loans and sub-prime mortgages have brought many people into serious trouble, and where animosity against Wall Street is clearly expressed in public.…”