Alistair Darling signals the end of easy money - Telegraph

In the months since Alistair Darling’s arrival at the Treasury, he has been a notably low-profile Chancellor.

One of the few New Labour ministers who has a positive aversion to spin, he has to a large extent kept his own counsel - until now.

This unwillingness to shoot from the hip gives a particular potency to his interview today with this newspaper in which he signals, in the most trenchant terms, the end of the era of easy money.

His assessment of the performance of our banks is excoriating and will infuriate the City.

He paints a lurid picture of get-rich-quick merchants who come up with “a fantastic way of making money” but who fail to ask “how is this money being made and what are the risks?”

It is up to borrowers to decide whether they can repay a loan - and up to lenders to ask themselves: “If it goes wrong, can I get it back?”

This may appear a statement of the blindingly obvious. That it requires the Chancellor of the Exchequer to articulate it shows how loose the system has become.

With perfectly judged understatement, Mr Darling suggests “there are times when going back to good old-fashioned banking may not be a bad idea”.

This signals a profound change in the terms of trade of the British economy.

A generation of consumers has grown up with the wholly understandable view that money - or at least credit - grows on trees.

Lenders fall over each other to bombard people with plastic. People carry levels of non-mortgage debt that would have terrified earlier generations.