It's a cycle, stupid!

Implications: Yes, it is a mess - I have seen about 3 or 4 cycles such as these over the last 30-years.  We have all seen this mess coming years ago. In 2004, a vast amount of mortgage originators were doing some very creative things to sell mortgages. HEOPA and high cost was in effect while these negative equity mortgages were written. But, if a measure of a trillion dollars markdown against the GDP is compared - it is not the end of the world - bad yes, stupid yes, and yes we will see this kind of thing again.

Analysis: Which ideal world are we aware of; where, McKillop would stand up today and announce his resignation. His position and those similar to his cannot be expected to be responsible for a cycle. If you are a wrongdoer, and that is confirmed... then you must take responsibility, but again... NOT FOR A CYCLE.

Apart from Northern Rock, a unique situation, not a single UK banker has willingly taken the drop. Oh yes, US congress and UK officials can say after the fact that there is someone to blame - and oh there he is!

Nope, they cannot be expected to be responsible for a cycle. However, they must stay in place (perhaps with remuneration penalties) to protect their shareholders interests so that this type of issue can be eliminated and we can garner the trust necessary to move forward.