Now we're talking.
The nudge-nudge, wink-wink culture that rewards traders who take huge risks and that allows controls to be set aside so long as the trades themselves are successful, but that criminalises risky trades that go wrong, is the heart of the market failure.
I'd be interested to hear a single case in which a trader who is successful but breaches a bank's controls goes to jail. Don't kill the golden goose, eh boys.
Banks should be rewarding prudent risk-taking, not mega-bets. If they are to have a social utility, banks should be something different from Las Vegas.
If the CEO's job is on the line in the event he tolerates this kind of culture, then maybe the culture will change. Freedom flourishes within a framework of law. It doesn't otherwise. I'd like to see bank trading risk audited and rated aggressively, so that some other measure of worth than profit is available to shareholders who are seeking to invest in the financial industry.
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