Confidence. The one aspect that the whole world took for granted as the indestructible element of the global banking system during the boom years of the late 90s and 00s. Banks lent freely to anybody who wanted money, and there were a lot of people who wanted it, all over the world. But their biggest customers were other banks. They all lent and borrowed to each other many times over. They all trusted that none of them would ever collapse.

Eventually banks had between themselves borrowed and lent so much money, including the trading of dodgy financial products, that they had in effect created a giant global bank. This ‘bank of the world’ ensured that if one bank collapsed under the strain of rubbish investments, the knock on effect would reverberate throughout the entire global financial industry. The fate of all their companies, and the wider global economy was allowed to become intrinsically linked.

When Lehman Brothers collapsed under the strain of all their rubbish investments, it took the confidence of the financial services industry with it. Many banks have collapsed before, but none has come even minutely close to the carnage Lehman’s collapse caused. The extent of the globalisation of the banking industry, and the ease with which money was transferred around the world between banks, to be invested in sub-prime financial products, is a direct cause of the severity of the crisis we are living through. Banks had become so intertwined that none of them really knew exactly how much they owed and to who, and when one collapsed they were all pushed to the brink. This should never have been allowed to happen. The blame for this rests with the regulators, who allowed bank’s care-free attitude to lending, and with credit ratings agencies, who rated toxic financial products as if they were top quality investment portfolios.

British Banking: Brown, The FSA & HM Treasury, the holy trinity of catastrophe…

The Financial Services Authority, the Bank of England and HM Treasury all turned a blind eye to our banks lending money all over the world, and it is arguably the biggest failure of regulation in the history of our country. Gordon Brown created and presided over a regulatory structure which was compromised from the very beginning. The FSA wanted the banks to maintain an orderly lending market between each other; which they did. The Bank of England wanted them to lend at or around the published rate of interest, to keep inflation stable and low; which they did. And HM Treasury wanted them to continue making lots of profits and pay lots of taxes; which they did. Not one of these regulators had the foresight, power, or the motivation to question whether the banks were being truly sensible with our money.

All three were happy with the status quo, not least Gordon Brown, who raked in billions in taxes on profits and bonuses, and even promoted the chief executive of the now-failed HBOS onto the board of the FSA, to spread his gung-ho attitude of how to run a bank throughout the regulation system too.

Frankly, it’s a shambles. The only way to restore confidence in the regulators, and therefore our banking system and economy as a whole, is to return full oversight of the banks to the Bank of England, and enshrine it’s independence, and ability to warn and punish banks. They must oversee a rebirth of the way our banks are run, never again allowing them to become so intrinsically linked to each other that the failure of one bank can threaten the stability of all other banks. It is only then that we can begin to rebuild our tarnished financial reputation and grow our economy again.

I am not calling for an increase in regulation, but I am calling for smarter, common sense, unbiased regulation. It is only with the restructuring of the regulators and the creation of an independent ratings agency that the banks, and the economy as a whole, will start out on the road to recovery. A failure to restore confidence will mean a continual lurch from crisis to crisis, resulting in the eventual nationalisation of every single bank in our country and a credit crunch that lasts a generation, which would be a discredit to us all.

"Look after the pennies and the pounds look after themselves." - Anon

The word graduation alone is enough to turn even the most prepared and organized student into a blind panic. Now we are facing a far more complicated and bigger challenge. With the current dismal economic climate and Gordon Brown doing all that he can to battle the rising unemployment rates, what are the options for those of us beginning our desperate search for employment and the dream job? Many of us are left feeling hopeless, with bleak prospects as we graduate smack bang in the middle of the biggest recession, with headlines like: ‘Britain set for deeper recession than early 1990s’ splashed across papers everywhere.

We came to university with great hopes of furthering our education and bettering our chances of achieving the career we desired. We also had the benefit of being at the height of an economic boom in Britain, with copious jobs available and employees receiving endless bonuses and benefits. The transition from university to the real world and working life had never been easier! Now the country and our situation could not be more different and daunting. Research has shown that the effects of the recession will be damaging to our incomes for several years, with starting salaries in London falling by 5% and 14% in East Anglia.

There are far fewer openings in popular jobs, like banking and accounting with many more being made redundant than employed. Most of us will be left with the depressing prospect of applying for jobs with a much higher number of applicants than places. So what is the key to success? Perhaps the answer is to continue in further education, as now has never been a better time to do it and a good excuse to spend more time living life as a student! Or maybe we will have to accept that we might have to apply to jobs outside our chosen field and be more flexible in the areas we are prepared to work and relocate to.

There is no doubt that our generation has a lot going for it and this too can be used to our advantage. Our ‘information age’ literacy means we embrace the internet with a passion and are more than familiar with banking and shopping online, making us adept in the current work environment. Undoubtedly, the most important thing is to market yourself effectively so you can stand out from the crowd, by gaining extra work experience or participating in extra university activities. High achieving students will always be snapped up but others might need to work a little harder to be noticed. On the plus side some employees are actively seeking graduates, they can no longer afford their highly paid staff but need people who they can pay less as a substitute.
It is definitely not all doom and gloom for us students; we just need to be more alert to opportunities that come our way and take whatever we can get! Flexibility and dedication is clearly the key.