When did bankers cease to be guarantors of civilisation's financial stability and become its destroyers?
As I file the mould off a crust of bread while rehydrating a thrice-used tea bag — next week, I'm going to the University Synthetic Biology Lab to get my metabolism recoded so I can live off floodwater mud, Autumn leaves, and unwanted estate agent brochures; or possibly unwanted estate agents: plump and juicy, they need no oil added in the roasting — I recall Radio 4's Today presenter telling us in May that on average, there were two banking news items per day. Now there are twenty, and the headlines are full of austerity.
Until today, chief amongst them was Kath Kelly, a teacher who lived — apart from rent — on just £1 per day. She foraged for berries in hedgerows, picked up £117 in coins found in the street, and instead of staying in, went out most nights to get free buffet food from art gallery openings, library anniversaries, and Bristol University public lectures. Here's one of her top tips:
Never ignore a market researcher, they often have freebies to give away. Completing a questionnaire could result in goods such as free shampoo or even cash.
The big headline today, of course, is Lehman. I confess that when searching Google News this morning, I mistyped their name, and got for my first search item a report called Another day, another battlefield. An appropriate title, and the report went on to write of:
attempting to recreate a war atmosphere on the rain-soaked grounds at Lehmann Mansion.But this, it turned out, was not some inglorious financial rout, but a Civil War Reenactment in Lake Villa, Illinois.
The thing is though, with the economy poised to become roadkill, shivering like a rabbit caught in the headlights of an oncoming recession, what caused this mess? It is, I understand, due to bankers tossing dodgy loans in one direction and bundles of million-dollar bills in the other with the careless abandon of little boys and girls dancing some unholy hybrid of Pass the Parcel. and Ring a Ring o' Roses. Like this:
Kick the debt to the left,
pass some bucks to the right;
Or perhaps, with apologies to the British Association of Folk Dance Callers, like this. Heavy stamp on the last word of the first four lines:
Take a mortgage in your left and throw;Whereupon each banker takes a deckchair as partner and frantically rearranges. The camera pulls back to reveal an opulent cruise liner, and a prop polystyrene iceberg looms from the darkness, painted "RISK" in huge block capitals. Nobody remains afloat.
catch a dollar in your right and gloat.
You sell on the debt they owe,
pour another Krug down your throat.
Hold out your empty palm
but wait one two three four.
Wait with your empty palm;
now wait two four six eight.
Ate no meat today;
our dollars have drained away;
Governments: turn — your — backs!
Once upon a time, things were different. Here's a quote I found in Software 73, Proceedings of a Conference sponsored by SOFTWARE WORLD at Loughborough University of Technology.It's from Software in banking, a presentation by D. L. Fisher, Bank of Scotland Computer Services, and is his reply to another speaker, Alex d'Agapeyeff. d'Agapeyeff had said that banks and airlines were at the forefront of software development and were the software pioneers of the future. But that, replied Fisher, was seriously in error:
Consider your requirements of a bank. You do not invest money in a bank. You put it there because it is safe. You entrust the bank with confidential details of your finances in the sure knowledge that they will be safe and that your confidence will be honoured. The bank is safe. You trust the bank. This reputation has been built up over centuries and is not to be cast lightly aside. You would look elsewhere for enterprise and pioneering spirit. You expect the staff, your contact with the bank, to reflect that sense of security and safety. Sober suits and quiet manner are the order of the day. Aplomb, style, energy and intelligence would encourage you to take your money elsewhere. This is not the stuff of which enterprise and pioneering are made.
In any case, the banks have little need to pioneer, least of all to pioneer the doubtful risky area of computing. As a well established bank of sound reputation, it is not easy to lose money. Indeed, the banks have little need to understand money, for they do not use it; they simply move it from one place to another. This is reflected in their computing. It is not by chance that the MOVE is COBOL's most powerful instruction. Fifty per cent of the procedural statements of COBOL programs are MOVE. We have been known to ADD and occasionally we MULTIPLY; but never, well hardly ever, do we DIVIDE.
So when did banking change? And why?