City Research Online

Abstract

This video re-examines key explanations of the Global Financial Crisis—product complexity, behavioural biases in decision making, systemic risk, and regulatory arbitrage and capture—and finds a common underlying cause, namely gaming by personnel at all levels in the banking sector and its regulators. This has enabled banks to use highly leveraged, maturity-mismatched investment strategies, which were designed so that the banks retained the upside rewards, but transferred the downside risks to taxpayers, leading to the privatization of profits and the socialization of losses—behaviour that has been described as ‘banksterism’. Although governments have introduced some significant mitigatory measures, they will not be effective in preventing future financial crises, because they do not and, indeed, cannot provide the appropriate incentives to end the Great Game between bankers and taxpayers, which would involve making bankers, rather than taxpayers, personally liable for losses.

This video is adapted from https://doi.org/10.3390/jrfm15060245

Publication Type:	Video
Additional Information:	© 2026, the author. This video was produced by the MDPI Academic Video Service. Content is available under the terms and conditions of the Creative Commons Attribution (CC BY) license; additional terms may apply.
Subjects:	H Social Sciences > HC Economic History and Conditions H Social Sciences > HJ Public Finance H Social Sciences > HN Social history and conditions. Social problems. Social reform
Departments:	Bayes Business School Bayes Business School > Faculty of Finance
SWORD Depositor:	Symplectic Administrator

Export

Downloads