For some years bankers have abandoned the absolute requirement for adequate collateral against credit which alone gave credibility to a financial system which is essentially artificial.

The veteran socialist politician Tony Benn, now retired, described the situation succinctly when he said "Government cannot be blamed if bankers lend money they have not got to people who cannot afford to borrow". That is what has been happening on a massive scale and millions of credit cards are part of it.

Economic circumstances have suddenly revealed the extent to which people are unable to service or discharge their debt. To make matters worse, in order to spread the risk, this debt has been packaged and sold on to other financial institutions across the world. For some reason, which has not been explained and for which nobody has been held accountable, that debt was given AAA credit rating by agencies on which bankers had come to rely. The original debt was largely incurred in the USA where the culpable rating agencies also trade.

As a result banks across the Globe have had to write off huge losses which some big names could not bear. The consequence is that they have ceased to trade adding to the problems of those remaining. Credit, from which banks make their money, has become toxic. Banks have ceased to lend putting business which depends on borrowed money in great difficulty.

Faced with the collapse of their economies Governments have almost universally reacted by pouring public money, by one device or another, into banks which could be saved. In Britain this has been done in exchange for ownership of a large proportion of shares in the banks helped. On the assumption that economies and the financial systems which support them will recover, those assets should appreciate in value over time and will be able to be sold back into the market at a profit.

That is not all. At the same time, almost universally, interest rates on deposits have been cut (in Switzerland to .05%) This means that financial institutions are holding depositors' money at little or even negative cost (allowing for inflation). There is a considerable gap between funds at no cost and the interest being charged on what lending is going on.

As one of the declared aims of policy is to encourage spending, to reduce substantially the disposable income of a large part of the population would seem to be counter-productive.

For the business community and the general public, whose savings form a large part of the capital available, this is a most unsatisfactory situation. Bankers create the mess and bankers are rewarded.

Of course the usual statements that it must not be allowed to happen again are trotted out. However the focus of activity is on getting the banks to resume creating credit, the uncontrolled volume of which got us into trouble in the first place.

The question has to be asked whether the creation of credit should be left to boards of directors responsive to the demand for profit from shareholders and over concerned for the remuneration of bankers. In this matter it is essential for personal greed to be tamed. The fact that personal greed equates with the profit motive may be uncomfortable but so be it.