Once the financial sector achieves a certain size, its continued expansion reduces economic growth
, according to a new study by two senior economists at the Bank for International Settlements
, Stephen Cecchetti and Enisse Kharroubi, using a large international data base stretching back more than 30 years.
this story stretches far beyond Britain. Barclays is the first bank in the spotlight because it offered to co-operate fully with regulators. It will not be the last. Investigations into the fixing of LIBOR and other rates are also under way in America, Canada and the EU. Between them, these probes cover many of the biggest names in finance: the likes of Citigroup, JPMorgan Chase, UBS, Deutsche Bank and HSBC. Employees, from New York to Tokyo, are implicated.
The rotten heart of finance
. A scandal over key interest rates is about to go global.
Naomi Wolf: The media's 'bad apple' thesis no longer works.
This global financial fraud and its gatekeepers
Limited Purpose Banking
-- for lending
. -- Turn all financial firms into mutual funds:
"All mutual funds would break the buck
with one exception: cash mutual funds. These funds would strictly hold cash and be valued at $1 per share. Owners of these funds would write checks against their balances and never have to worry about a bank run. Fractional reserve banking
and the FDIC would be history
] [more inside]
The second most powerful United States Senator
admits, "And the banks -- hard to believe in a time when we're facing a banking crisis that many of the banks created -- are still the most powerful lobby on Capitol Hill. And they frankly own the place
." [more inside]