Some of the finest minds in financial blogging have focused their attention on the dual issues of wild bankers and submissive regulators, and they have come to the same conclusion: invoke the draft.
Fintag, a hedge fund blogger equally known for his doodles, ran a post a few weeks ago suggesting that the best way to empower the regulator would be to oblige bankers to work there.
The FSA already allows bankers to work there on secondment, but it doesn't force them to. If wholesale financial services professionals were obliged to rotate through the FSA every few years, the regulator might get a higher calibre of talent.
Clearly, there would be a danger that those professionals would come out with intimate knowledge of how to avoid regulation, but this could be mitigated with electric shock therapy after each period was over. Alternatively, it might be hoped that a few months at the FSA would imbue participants with a sense of regulatory fulfillment and moral purpose that would make gaming the rules unthinkable.
Failing this, it would also help to mandate all students with a 2.1 or above from a top 5 UK university to work in financial services for at least 18 months post-graduation, and to carry on doing intermittent 12 month stints in banks for the rest of their working lives (or until they are unable to focus on a computer screen).
This would give the population at large a better understanding of banking. It would also render it a deeply unsexy career and restore financial services to the utility status so loved by the likes of Adair Turner. And it would force banks to employ significant cohorts of English students and left wing types with no interest in making money and limited understanding of complex derivatives. Mortgage mis-selling, excessively large bonuses, and CDOs would become things of the past.
Chris Gillick, a former editor of Trader Monthly (before it went bust) has a similar draft-style suggestion on his blog, 'American Madness'. However, his is rather complex and involves football. We think our FSA/lifetime bondage combination is the best and are waiting for the Monster Raving Loony Party to add it to their prospectus for the next election.