Banks Punished For Central Bank And Political Errors

In recent decades politicians have increasingly followed the Keynesian prescription
of economic growth through continued government borrowing and the creation of
undreamt of amounts of fiat money by central banks. To facilitate this process, the
larger commercial banks have acted as the central banks' de facto distribution
system, and as a result have grown ever larger while accepting progressively
greater risks.

In 2008, potential catastrophe loomed as the entire international financial system was challenged with collapse. But, as the 'darlings' of the central banks, the "too big to fail" banks were saved by taxpayer bailouts so that they could continue to play their role in the stimulus engine. But as a
result of these distortions, the environment for those banks outside of the exclusive "too big to fail club" has been increasingly challenging. In the United States, the financial services industry is changing radically and many fear that the days of US dominance will be coming to an end.

Public ire resulting from the 2008 financial crisis largely missed politicians and central bankers and landed squarely on "Wall Street." As a result, bankers have become easy political targets. Increased regulation of the banking sector has become the rallying cry for the political left.

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