Alex Brazier: "Debt strikes back" or "The return of the regulator"?

Speech by Mr Alex Brazier, Executive Director for Financial Stability Strategy and Risk of the Bank of England, at the University of Liverpool, Institute for Risk and Uncertainty, Liverpool, 24 July 2017.

The views expressed in this speech are those of the speaker and not the view of the BIS.

It is an honour to be invited to contribute to this lecture series here at the Institute for Risk and Uncertainty.

Thinking about risk sometimes has a more derogatory description: worrying.

And worrying has a bad name for itself as an unproductive, possibly harmful, activity.

But intelligent worry - worry about what could go wrong and action to deal with it before it does - is central to the aim that this Institute and the Bank of England share: creating a safer world.

So in much the same way that Star Wars fans must enjoy conventions that bring together like-minded people, whose interest is not always appreciated by others, it is a pleasure to be here with fellow intelligent worriers.

With household debt at high levels and after a period in which consumer debt has increased very rapidly, my theme this evening draws inspiration from the Star Wars films.

I'll ask whether the economic galaxy is destined to be upended as Debt Strikes Back, or whether there is New Hope and the galaxy can be a safer place thanks to the Return of the Regulator.

My conclusion will not surprise you. But before we get there, I want to take you back to a galaxy that may now seem far, far, away...