Ed Balls: “I genuinely have an open mind” about full-reserve banking

Former Shadow Chancellor discusses proposals for radical financial sector reforms

LONDON, 19th September 2017 –  Former Shadow Chancellor Ed Balls considered whether a dramatic shake-up of the banking system is needed to prevent another crisis, at an event marking 10 years since the crash, at the RSA last night.

Speaking alongside Financial Times associate editor Martin Wolf and Positive Money director Fran Boait, Balls said “I genuinely have an open mind” about whether a full-reserve banking system could be the “right solution”.

The event, titled ‘Out of the darkness: Can a reformed financial system help solve the world’s big problems?” and put on by Positive Money as part of the 10 Years After The Crash series, saw the three experts reflect on the last crisis and discuss the merits of Positive Money’s sovereign money proposals, in a panel discussion chaired by Newsnight presenter Emily Maitlis.

Martin Wolf opened up the debate by advocating for a 100% reserve banking system to increase financial stability, warning that “the question is not if, but when” we’ll have another “monstrous financial crisis”, concluding that “very radical reform is something we should be thinking about”.

Balls struck a more optimistic tone, claiming that “another big financial crisis is probably decades away”, though adding that it could be “just around the corner”.

Fran Boait responded to argue that “we are still in a long drawn-out crisis”. She said “we’re always trying to have a crash before we go into the reform agenda, adding that “the problem is financial reform is shifted off the mainstream debate, and we need to bring it back.”

Notes

A live stream of the full event can be viewed at: https://www.facebook.com/PositiveMoney/videos/1625317977518600/

For high-res photos of the event, or further comment, please contact Simon Youel at simon.youel@positivemoney.org.uk or 02072533235 for more details.

Positive Money campaigns for a money and banking system that supports a fair, democratic and sustainable economy. Set up in the aftermath of the financial crisis, we are a not-for-profit company funded by small donors, charitable trusts and foundations.