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[...] For a society to base its financial system on alchemy is a poor advertisement for its rationality. The key to ending the alchemy is to ensure that the risks involved in money and banking are correctly identified and borne by those who enjoy the benefits from our financial system.

[...] But if the assets have genuinely lost value, then the central bank must be careful not to subsidise insolvent undertakings. [...]

[...] Prices and wages do not adjust instantaneously to clear markets whenever demand and supply are out of balance. Firms change price only irregularly in response to changes in demand; wages adjust only slowly as labour market conditions alter; and expectations are updated only slowly as new info…

Eighteenth-century thinkers, such as David Hume and Adam Smith, understood the relationship between the amount of money in circulation and the prices at which goods and services were bought and sold: 'if we consider any kingdom by itself, it is evident, that the greater or less plenty of money is o…

Everyone on the island felt let down. The cult of finance had led to the contraction of a successful fishing industry. Too many talented people had been sucked into trading which, with the benefit of hindsight, was little more than a zero-sum activity generating little or not output. How could so m…