FSA admits concern for financial industry

In a speech to the Lord Mayor, Callum McCarthy pointed to crisis in the subprime mortgage arena and, more recently, with Northern Rock, as the main contributors to “problems of liquidity and – crucially – confidence” across the industry. He highlighted a trend of risk aversion developing in the markets, pointing out “asset classes which were widely accepted are no longer freely traded”. However, McCarthy did point to a strong economy and suggested 2007 will be viewed with hindsight as an extreme. He added we should not “regard all that has changed as change for the worse”. “The last week...