All true but if the author has any solution he is keeping it to himself. Of course the financial sector is self serving. Most professions are, but some are better at regulating themselves than others. The financial sector, however, has to be strongly regulated. Partly by luck, and partly because we learnt our hard lessons on regulating markets in the 1990 bust, Australian as escaped this crisis with it financial institutions largely intact. So far so good. So what about the big bonuses the likes of Macquarie bank pay out? If anyone has any ideas let's hear them..

More regulation Curmudgeon?

By who?

The same people who audited Madoff for two years and somehow failed to realise he was running a Ponzi scheme?

MORE REGULATION WON'T WORK.

Here is something that will.

When you become a director of a major bank your personal fortune is at at risk. If the bank goes belly-up or needs a bail-out while you are director, or within one year of your ceasing to be a director, you have to pay the bank's creditors the GREATER of:

(1) The sum total of ALL your assets and those of your spouse(s) up to and including the shirt on your back; or

(2) The sum total of any monies you have received by virtue of being a director in whatever form. This includes director's fees, stock options, re-imbursements for expenses and the cost of any lunches served during board meetings.

If your personal fortune is too small to cover the second of the above you go to prison.

All that is left to you at the end of the process should be enough to purchase a suit, a shirt and a change of underwear at an opp-shop plus three nights' accommodation at a one star hotel.

Your passport is cancelled.

Any gifts you receive, including gifts in kind, are subject to confiscation. If a friend offers you a couch on which to crash for a few nights the friend has to pay the cash equivalent to the bank's creditors. Ditto if the Salvos put you up for a few nights.

Any "loans" are deemed to be gifts.

For five years any earnings in excess of the old age pension are confiscated.

Nothing less will work. Trust me on that. I have worked in banks and I know these guys. What they fear most is poverty. Only the threat of poverty will make them behave responsibly.

We need a progressive tax system that virtually taxes collosal payouts
out of existence.

Steven - actually your list of demands is (mostly) in place already, although not quite in the form you suggest.. through the trading while insolvent rules.. company loans to individuals are also now characterised as income, unless it can be shown to be truly arms-length transaction - a requirement brought in to stop tax avoidence rathern than for corporate governmance..
As for regulation not working, the Aus system is strongly regulated and has survived well.. the US system was weakly regulated and was the source of all the trouble..