The best thing I can do here, I think, is pip Peter Hume to the post and offer a link to the wisdom of Mises concerning banking:
http://www.lewrockwell.com/north/north86.html
There is something dreadfully wrong with a financial system which offers the greatest gains to those who risk the least, and sacrifice absolutely nothing.
It isn't that the system contains a few rogues; the system itself is fraudulent.

Thanks Julie, interesting piece that I hope some of the "alleged 99%" will read and understand. One thing I note about the bailouts (and I rely on Wiki here for my facts so hopefully they hold) is that the "cost" of the TARP bailouts (I assume the opportunity cost to Government diverting public funds temporarily to take up preferred stock etc. in nearly bankrupt businesses) came in at about $19B, a microscopic fraction of US GDP. Maintaining public confidence in some significant publicly listed (large employer) entities probably never came so cheap.

GN271011
Julie Novak
You say:-
“Perhaps to a great extent some of these hostile feelings towards the financial system might be due to a misunderstanding or lack of comprehension, about the beneficial role of a functioning financial system for economic prosperity”.
Sorry for my misbehavior, Julie.
From now on, as I see my savings eviscerated, I will appreciate the beneficial role of our functioning system for economic prosperity

You state: "Fundamentally, the role of the finance sector in the modern economic system is to connect those in the economy who have saved part of what they earned with those who desire to borrow funds to invest in various ventures.

In other words banks and other financial institutions, when they function normally, play a constructive role in transferring financial assets to more highly valued uses."

Sorry Julie, but banks only need to hold 10% or less of depositors funds. They have the ability, and always do, to leverage additional funds into the system (Ponzi finance) on the remaining 90% or more of the funds and that is why we get debt at the levels we see today.

Correlate that with declining cheap energy (a key ingredient in any functioning growth economy) and you have a disaster in the making.

Mark my words...what we have seen to date is just the tip of the iceberg, the whole global banking and financial sector (growth model) is about to implode. There is not enough energy (cheap oil) in the system to keep the growth economy from stalling and falling into a serious descent.

Econmists externalise energy and do not rationalise it into mainstream economic modelling/practical application. As such, this is why Europe and the U.S. are in terminal decline, it won't matter what governments, financial sector, politicians say or do, the system is a brittle web, a few small shocks can be taken, but as energy declines further, the shocks get greater and the brittle web crumbles.

Why did NAB and Westpac fail to reveal that they had to borrow billions from the U.S. Federal Reserve in 2009/10, because they were technically broke, no mention here in the press about it, or from the Reserve Bank or APRA? If you were a stockholder wouldn't you have liked to know?

The 99% are right, they just haven't worked out how to get a clear message across. The system is rotten to the core and is beyond help.

Growth is dead, get used to it, get out of debt as soon as you can.

I agree Geoff of Perth.There is a fundamental flaw in the banking system and that is their power to counterfeit our currencies by the fractional reserve system of banking.

Banks should only be allowed to loan out money that already exists and not create increases in our productivity as debt with the click of a computer mouse.

Title intriguing, opening questionable. I've followed OWSNYC. Link to someone who covers the world of OWS.

http://armstrongeconomics.files.wordpress.com/2011/10/armstrongeconomics-occupy-wall-st-goes-global-101611.pdf

Where you get information. a certain amount of MSM bias.Check people who go to protests, a different viewpoint than the MSM!

Americans who don't know how it all went wrong but are annoyed.

Independent survey of OWSNWS: 70% are politically independent. US blogs I am at, real people who talk with protestors,Young, old, middle-aged. some damaged by government schools, a spectrum of opinions. Democracy in action.

Your title, article, good theory. I cannot speak for the Australian experience of banking but I do know about banking in U.S. history.

Geoff had it right about two of the "big four", he missed the RBA tapping into TAF.

bitey knows one statistic, is unaware the US Federal Reserve unleashed $16 trillion dollars on the global financial system after GFC. TARP was the least of the interventions.

OWS doesn't need a message, as many call for. That would make it easy for the MSM to marginalise them more that they did. Nor do they need 'a leader'. Same reason.

I recall a YouTube of some young bloke, lecturing on monetary theory, might have been reading from Hayek.

A whole different ballgame. No message, no sound bites. No leader, who needs an empty suit with glib teleprompter skills?

Julie, those "occupiers, with an inherent bias against market capitalism", a subset of the whole. Maybe you've not followed the malfeasance in the US banking system, predatory lenders, MERS scandal, derivatives TBTF spawned and bet against -- the real banking reality.

Regulators that don't regulate, ratings agencies get a fee for AAA on toxic substances, insiders trading with vampire squids. Matt Taibbi's articles, William K. Black interviews, Michael Lewis, half a dozen blogs will tell you about the perfidy of the US banking system. The only factor is corruption.

The only local colour I can add, Why did RBA sell 2/3 of the gold reserves in 1997, in advance of the "Brown bottom"? Was this was a concerted plan ...