Reuters reports: It
wasn't supposed to be like this. After
the worst financial crisis since the Great Depression almost took the global
economy over a cliff, tough new regulations and stronger internal controls at
the world's major banks were meant to help restore confidence in the financial
system.
But recent headlines have some top investors and strategists
questioning whether there has been any progress at all. The horror stories include the deepening
scandal that big banks rigged Libor, the benchmark international lending rate;
JPMorgan Chase's (JPM.N) mounting losses from disastrous credit bets and a
possible cover-up attempt; and the disappearance of customer funds from Iowa
futures broker PFGBest, discovered after its founder tried to commit suicide
and left a note outlining a 20-year fraud.
The signs of a falloff in investor confidence are not hard
to spot. U.S. Treasuries, the
traditional safe-haven for risk-averse investors, are drawing big demand even
though they offer only the slimmest of returns, while U.S. equity mutual funds
have racked up big outflows….
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