Financial reforms introduced since the crisis still have not addressed the fundamental driver of economic and financial instability – continually rising levels of private debt, argued Lord Adair Turner, former chairman of the Financial Services Authority, in a speech at Goethe University in Frankfurt on Monday 10th February 2014

“Over several decades prior to 2008, private credit grew faster than GDP in most advanced economies and leverage therefore grew. That was a major cause of the crisis and the main reason why the post crisis recession was so deep and the recovery so slow and weak.”

“To achieve long-term stability, we will need to address these fundamental drivers of the crisis and the post-crisis recession.”

“It’s very easy for us now looking back to say ‘weren’t our bankers lunatics? They must have been crazy and irresponsible.’ But in order to stop it happening again, we can’t point to individuals; we need to look at why the system is bound to push them towards it.”

Read more in the Guardian, Telegraph, Independent

Paper & presentation available on the Institute for Economics Thinking blog