Banks have been carrying out trades which are ‘economically useless', Adair Turner says.
"No economic value" was added by some of the trading room activities at some banks in the run up to the financial crisis, said the FSA chairman in a lecture ‘What Do Banks Do and What Should They Do?' in London yesterday. He gave the example of "tailgating strategies", in which investors ride an "unsustainable" trend in the hope they will manage to get out just ahead of the crash. "There is no economic value that I can discern from the operation of speculators in currency ‘carry trades'...
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