Pretty sure you've got him mixed up with someone else, I went to a review of his book and saw this: "Matt Ridley is a zoologist by training and a disciple of Richard Dawkins."
He was made a board member because his father had been a board member. And then he was promoted to chairman of the board. His academic training was in zoology but he wrote for the Economist.
> He was made a board member because his father had been a board member
How amazing that the free market in employees would produce such a coincidental result! That the most economically efficient person would be a relative of another board member!
That the bank failed seems to be a indication that it was not economically efficient and the market correctly removed it. That seems to be the exact thing that we want.
For some (easy to understand) reason government have taking into their heads to 'save' these institutions, but you can hardly blame that on the market as a organisational principle.
The government did not try to 'save' this bank. The government tried to stop its contagion from spreading. Hoover had allowed that sort of contagion to spread in 1930 to ill effect.
Also, you are ignoring the Major Major Major Major who ran this bank and now lectures us about economics. If Hayek is the marginal figure he is, it is partly because of the Ridleys championing him.
This 'Hoover let it continue'-story is partly correct but it ignores the larger and far more important story. The bank failed because there was a liquidity crunch caused by a badly implemented gold standard and a even more badly manged Fed that failed to do its job. Its not the banks fault that there is a massive liquidity crunch. Its also not the banks fault that they have been legally restricted from note issue. In Canada (with no central bank) no banks failed in the same period, but the economy of Canada was hit almost as hard.
By the way the hole argument that you are making goes back to a British guy 100 years ago (Walter Badget, often called "Lender of last resort"). You would be to discover that this guy was actually against the idea of saving bad banks, and even more he was against central banks in general. His argument was that if banks can not expand liquidity themselfs as they did before central banks, then the central bank must do it, BUT ONLY TO GOOD BANKS AGAINST HIGHLY SECURE ASSETS AT HIGH RATES.
Sadly his arguments have been turned around into something different by people who don't want to read his point for political reasons or simply don't understand them. Now its, 'if you let any bank fail, a domino-effect will destroy everything', this is simply false, most of the time, most banks are good. The problem is liquidity, and the central bank is in control of that, that its job. The domino effect only happens if the central banks fails, as the Fed did in 1930 and 2008.
I'm not in detail informed about this particular case in England. I made a general point about markets and governments.
I used to think they were two different people, as chairing a bank and being a science writer are not normally found on the same CV. However, it seems that he's just one person (https://en.wikipedia.org/wiki/Matt_Ridley).
