Turner likened the global financial system to “some incredibly complicated waterbed” where regulators attempt to plug a leak on one side only for a new one to spring up on the other.
“We’re just not clever enough to see it,” Turner said in an interview with Prospect magazine.
Turner also hit out at what he said was deliberate action by some influential policymakers in the US to starve its regulators of funds.
He is worried the American financial industry is succeeding to dissuade lawmakers from pressing ahead with a sweeping reform of Wall Street known as the Dodd-Frank Act.
“What is going on in Congress is deliberate action to starve some US regulators of funds, which I think has a degree of motivation coming out of some financial interests through campaign money to members of Congress,” Turner said in the Prospect interview.
The FSA is being replaced by two new regulators next year, one inside the Bank of England, the other a standalone consumer watchdog.
Turner has been touted as possible future governor of the Bank of England.
