UK business secretary Cable warns of another crash

UK business secretary Vince Cable sees another financial crash looming as according to him, governments had collectively failed to grasp the seriousness of the last one.

Cable told the New Statesman newspaper in an interview that enough was not being done internationally in terms of regulation and the structure of the banks.

The Liberal Democrat cabinet minister said his greatest concern was whether another crash was inevitable or it could be avoided.

Cable said he was very impressed with the Warren Buffett metaphor that asset-backed mortgage lending was the atomic bomb, and that there were hydrogen bombs out there. He added that he just did not think that collectively governments had got to grips with that at all.

He said it was not imminent but one could see another bomb going off. According to the business secretary, regulation was happening in bits and pieces and was was very piecemeal. He added that the issue of structure of banks was being addressed in the UK but nowhere else.

Cable added there was a bit happening in terms of complex derivatives, in terms of clearing house arrangements, though it was a bit limited.