Are international banking regulation changes being quietly dropped?

Mervyn King, the Gov of the Bank of England, has today voiced his concern that previous vocal support for wholesale changes to the UK and international banking arena may well be starting to subside. There is a growing concern that as the worldwide economy picks up, as it has been of late, the need to curry favour with the public by pushing ahead with banking regulation changes could begin to diminish.

While many believe that the proposed changes to the UK and the world by banking system, and talk of a Robin Hood tax, are nothing but pandering to public anger against the sector, some experts believe we could witness a credit crunch type recession in the future unless changes are made. There is no doubt that the risk element of the worldwide financial arena has increased over the years with the introduction of new financial tools and new financial vehicles.

Quite how the worldwide authorities will be able to control and maintain the financial sector while also allowing it to grow and push forward the worldwide economy and national economies remains to be seen. The reason the financial sector has grown so much over the last few years is because of the greater risks taken in pursuit of new financial tools and new financial vehicles. If this is taken away, we risk closing the door on the engine room of the worldwide economy?