Economics as Ethical Pre-condition of the Credit Crunch
No bust can occur without a preceding boom in which we are sold a covering story, a story that enables the homogenised behaviour that every boom needs. One part of that story was a common belief in the triumph of markets after the
fall both of Keynesianism and of the iron curtain. Economics came to represent this triumph and was at the heart of the macro level management of the economy. It appeared the economy had entered a new phase, the ‘Great Moderation’. Significant macro risks seemed a thing of the past. Our focus here though is on how economic thinking shaped organisational behaviour and the micro level management of risk. Our particular focus is on the conduct of banking.