It is always worth listening to Alan Greenspan, but not now – for the same reasons we used to. The former US Federal Reserve chairman, the wizened wiseman of laissez-faire economics, shocked us all – and probably himself – when he told a congressional panel in 2008 that he had found "a flaw in the model I perceived is the critical functioning structure that defines how the world works, so to speak". He meant that he had realised banks cannot be trusted to manage their own risks, and that markets do not smoothly self-correct.