Lord Turner, chairman of the UK Financial Services Authority, visited Washington DC today to discuss the role of the financial system in the recent economic crisis , and delivered a speech to a conference organised by National Journal magazine.

In his speech - "Examining the Causes of the Financial Crisis" - Lord Turner presented his views on the global economy, and what he sees as the necessary next steps for successful international financial and regulatory policy.

Lord Turner said:

"We have to recognize that what occurred was not just a crisis of specific institutions and a failure of specific regulations. But a crisis for the entire intellectual theory of efficient, rational and self equilibrating markets."

"In the aftermath of the crisis we must therefore challenge previous assumptions - for instance that increased liquidity in all markets is always beneficial, or that financial innovation will always deliver beneficial results."

"We need to ask questions about the role which the financial system plays within the economy, recognizing the danger than in some circumstances and in some activities it can swell beyond an economically useful size."

His speech was followed by a discussion with some of the country's leading financial policy thinkers and commentators. The event was the first in a new series - "The US in the Global Economy" - presented by the Economic Club of America and National Journal Group.

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