Last month at The Forum in London, the MiFID conference sponsored by JWG-IT, David Wright, deputy director general, EU Commission, told bankers they should take the current financial crisis seriously.  “The firms that created this mess have to step up to the plate. This is not the time for firms to seek de minimus solutions or to seek delay,” he warned. “We need some action, and firms need to step up and lead.”

Evidence suggests financial service firms are hoping the regulators just go away. At a Thomson Reuters meeting in New York last week where Philippe Carrel, EVP at Reuters, was championing a plan to develop consensus-based proposals for valuing illiquid securities,

Increased regulation received little support, although some participants thought regulators could play a role in the credit rating oligarchy and perhaps in requiring more disclosure of underling risks in investments.

Paul Volcker, Fed Chairman from 1979 to 1987, yesterday told Congress that as conditions in the markets improve, people are getting complacent about the need to address regulatory failures.

The banking industry doesn’t appear to appreciate the severity of the problem. As people lose their homes, in the US, and can’t buy or refinance in the UK, and as both countries face some interesting political competition in months and years ahead, these problems are not going away, even if the financial markets appear to recover.

One problem – banking doesn’t appear to have any individual leader on either side of the Atlantic who is willing or able to address the issues.

Filed under: Credit Crunch, Technology, regulation