Professor Philip Lane:

That is definitely a big part of the mechanics of what went on. Let us remember that the reason that the frenetic innovation was taking place was that interest rates were so low that many investors in order for them to be able to offer a reasonable return had to do something different. The reason that interest rates were so low was that essentially one had a great deal of global saving being released out of Asia. The money coming out of Asia was concentrated on low risk products. They were not interested in taking global risk. The low risk end of the market became not very attractive for everybody else because there was so much demand for low risk products from Asia. All of these new types of products were being driven by a "search for yield". How in this environment can investment make a bit extra? The ideal is to find something that makes a bit extra but looks safe. This is the reason for securitisations - trying to come up with AAA, which was not safe.

With regard to billionaires, the first point is that there are different types of billionaires in the world. Some are probably contributing to the global savings glut. Remember that a great many billionaires are essentially aggressive risk takers. They also borrow a lot. They may be quite rich but they would be part of the risk-taking side.