Margareta Pagano: This time we must listen to the black swan

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The Independent Online

Nassim Nicholas Taleb is making ripples again. The brilliant author of The Black Swans has set up a petition on his Facebook page calling on the US government to force bankers to give back their bonuses. Taleb tells me that more than 800 people have signed up to the cause – a number that is growing daily. His co-conspirator is another great mind, the New York University economist Nouriel Rou-bini, which is nicely unpredictable as Taleb doesn't rate economists. But Roubini is rather different as one of the few forecasters to have warned years ago that the world's economy was heading for the buffers.

The two have set up "J'accuse" on Facebook to urge President Obama's government to make it mandatory for those bankers who have taken money from the bailout to give back their bonuses – all of them. Top of Taleb's list for punishment is Robert Rubin, the former US Treasury Secretary who received more than $100m while working for Citigroup. This, says Taleb, should be paid back because of Rubin's failure to understand the risks his bank was taking. For someone who urges us to accept we understand so little about the world around us, Taleb, a former derivatives trader, is very sure that he is right.

Taleb doesn't think that Barack Obama has gone far enough with his plans, announced last week, to put a ceiling on pay. There's only one way to make bankers accountable and that is to hurt them where it counts – in their pockets. And Obama could do it because there are claw-backs in the new stimulus package legislation that make this possible. If the US government doesn't push for it, then he says the shareholders in the bank – or the public via the Facebook petition – must do the work for the administration. So far, only the Swiss have forced their banking executives to pay back bonuses.

Here in the UK, the Government has to show it really does understand the depth of public outrage on bankers' pay. The squabble over potential bonuses for staff at Royal Bank of Scotland gives it the perfect chance to get to grips with the fundamental flaw at the heart of investment banking by stopping high pay for high risk (based on mathematical risk models that Taleb would argue could never be accurately calculated).

As the majority shareholder, the Government must simply refuse to allow any bonuses to be paid, to anyone. RBS denies reports that it will pay tens of millions of pounds in bonuses. But there is still some confusion over whether it is contractually obliged to fork out for promised bonuses to junior staff. The bank broke its contractual relationship with its shareholders and may well have to do the same with staff. If RBS were to spend taxpayer money on bonuses then don't be surprised to find more wildcat strikes breaking out on our streets. Can you imagine a situation where government-owned banks allow bonuses while the still privately owned banks, like Barclays, cut back on remuneration?

On Tuesday the former bosses of RBS and HBOS – Sir Fred Goodwin, Sir Tom McKillop, Andy Hornby and Lord Stevenson – are due before the Treasury Select Committee. While they deserve a roasting, there is also a danger that the event will turn into a show trial – that they become the sole scapegoats for a system which everyone, the Government included, bought into. This would be a terrible mistake if, behind the scenes, the old system of high pay for failure is allowed to continue.

That's why the J'accuse campaign is so powerful. Governments must show that bankers will be made accountable for the obscene behaviour of the past. As Taleb says: "We have a system which is the worst of capitalism and socialism, a situation in which profits were privatised and losses were socialised. This will stand as the biggest government-sponsored scam in history."

Taleb and Roubini warned about the crash years before it happened. Both were universally scorned and now both are being feted as apostles. This time we should listen to them.

It will take more than Gallic charm to revive the London Stock Exchange

I have met Xavier Rolet, the French trader tipped to take over from Dame Clara Furse at the London Stock Exchange. He is charming and his pedigree in the equities cash business is good: he has worked for Goldman Sachs, Dresdner Kleinwort Benson and Credit Suisse.

Most recently, he worked in London at Lehmans (not so good) where he was in charge of customer management, before moving to Paris to head the investment bank until it was rescued by Nomura. Rolet knows both front and back ends of the highly competitive and incestuous exchange world. He sat on the LSE's strategic committee and on one at Euronext, its most bitter rival and with which the LSE has had a long courtship.

But I am surprised Rolet might get the nod over Massimo Capuano, the Italian deputy to Dame Clara after the merger of the LSE and Borsa Italiana. Capuano was led to understand he would get the job if Dame Clara, who has been there for eight years, decided to quit. So what he does next will be interesting.

It looks as though Rolet is being hired for his networking skills as much as anything else. No bad thing as the biggest challenge facing the LSE is making sure customers don't opt for cheaper rivals. But he will need more than charm to pull the exchange out of its malaise.

LSE shares are just off their low at 443p but far away from the £20 high of a few years ago. Business is down due to the lack of flotations and other revenue, but its monopoly is also being nibbled away by competitors such as ChiX, Turquoise, BATS and even, to a lesser extent, PlusMarkets.

Rolet is an old hand at the Paris to Dakar rally, one of the toughest adventures of all, but the desert run could be a joy ride compared to the roller-coaster waiting for him at the exchange. It wouldn't surprise me if the trip took him into the arms of NYSE Euronext or Deutsche Börse.

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