They helped cause the crash. Then profited from it. Now, from the Bank of England to the Fed, ex-Goldman Sachs chiefs are pulling the levers of power.

Amid the recent management shake-up at the top of the Bank of England, as it was dragged into the investigation of the alleged fixing of the £3 trillion-a-day foreign-exchange markets, one crucial appointment went almost unnoticed.

While public attention was understandably focused on an Egyptian-born mother of twins becoming only the second female deputy governor of the bank, the far more influential appointment was that of economist Ben Broadbent.
As the new deputy governor for monetary policy, he is now the predominant voice on the future direction of interest rates.
His work will have a huge effect on the lives of the British people, for he will have a key role in deciding when the record five years of super-low mortgage rates will end — a decision that will inevitably lead to home-owners facing considerably bigger monthly bills.
But there is one crucial fact that should concern us about the Cambridge and Harvard-educated Broadbent: he spent a decade during the boom-and-bust years as the senior economist at the global headquarters of the investment bank Goldman Sachs.
He joins an elite few who hold senior positions in the world's most powerful central banks — from London to New York, Frankfurt and beyond — and all of whom come from this one company, which was controversially described by Rolling Stone magazine as 'a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money'.
The fact that so many alumni of the world's most profitable — as well as most ruthless and cunning — investment bank wield such a level of influence in these central banks is nothing short of remarkable.
Because Goldman Sachs is an institution that, as I will explain, not only helped cause the financial crisis in 2008, but also profited from it — hugely enriching its own staff while leaving a trail of chaos for taxpayers to clear up.
Do we really want one of the most controversial financial institutions on the planet, which was eventually fined a record £343 million for shamelessly misleading investors during the crisis, to have so many of its ex-staff holding the levers of power in the City of London?
What makes the choice of Broadbent an issue of major public concern is that his period at Goldman saw the New York investment firm deeply embroiled in some of the most shocking financial scandals of recent years.
First, there was the crisis triggered by the sub-prime mortgage disaster, when vast quantities of loans were made by U.S. banks to homeowners who could never pay them back.
This reached disaster point in 2007-8, once the loans had been sold on by banks and institutions around the world — by which time they had been packaged up as financial instruments or 'derivatives' so complicated that no one could tell how toxic they were.
Goldman Sachs played a key part in inventing these poisonous derivatives, which were a major factor in triggering the financial crisis.

READ MORE: How the vampire squid is controlling our lives: They helped cause the crash. Then profited from it. Now, from the Bank of England to the Fed, ex-Goldman Sachs chiefs are pulling the levers of power