The World Economic Forum (WEF) has warned that Britain's economic reliance on the financial services industry makes it more exposed than most to the effects of the ongoing credit crunch.
The WEF's annual Global Risks report warns that Britain may bear the brunt of the growing repercussions.
Quote:
"In Europe, the prominence of the UK's financial sector makes it vulnerable."
The WEF also notes that the crisis has raised "fundamental questions over the vulnerabilities of the current model of financial markets".
The WEF see that paradox in the speed of reactions and cohesiveness of the global financial system:
"while the financial system has been made more efficient and stable in normal times, it is also now more prone to excessive instability in really bad times."
WEF is calling or greater collaboration between policymakers and the private sector to address these problems.
As noted before on this site, the credit crunch is a creation of the bankers out of a situation of their own creation. They have the liquid funds available to lend to each other, but their fear has paralysed them like a rabbit facing the headlights.
Until the banks show some leadership and courage, the crisis will continue.
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