Reform school for bankers

The world’s leading investment bank puts itself under the spotlight

Oct 3rd 2013

RUMOURS of a cash crunch and hidden losses on derivatives start flying. Markets turn jittery. Stocks fall and counterparties begin to pull in credit lines. One of the world’s largest financial firms is on the brink of collapse, threatening to plunge the world into yet another crisis. In a boardroom high above New York the firm’s senior executives meet representatives of Goldman Sachs and ask for reassurance it will keep its credit lines open. Should the bankers stand by a client, even if it means putting Goldman Sachs at risk, or should they protect themselves, possibly precipitating a financial meltdown?

This article appeared in the Finance & economics section of the print edition under the headline “Reform school for bankers”