Matt, the financial crisis and Ronan Point

Matt is an engineer (though not a terrorist). The other night when he was at the RSA listening to a pundit explain the financial crisis, something chinked with Ronan Point:

“This actually has a link to structural engineering where various previous failures, most famously in this country Ronan Point flats in East London,  mean that buildings are now design to avoid disproportionate or progressive collapse.  This means damage to a a small part of the structure should not lead to collapse of all or even a large part of the building.  Now obviously there are limits to this otherwise we would all live and work in concrete bunkers but there are other precautions taken to further protect vulnerable buildings which are exposed to greater levels of risk than normal.  It seems to me that the we could do with something like this type of approach when designing the new regulatory system for the financial sector, the regulation of structural design has not stopped innovation but has provided clear boundaries and guidance on what is acceptable.”

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One thought on “Matt, the financial crisis and Ronan Point

  1. I heard a good analogy about the financial crisis being due to these products being so diluted and “virtual” that they were “homeopathic”, that is, so dilute and abstract that only a vibration or echo of the real product remains, and that it doesn’t work and does nothing.

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