The Wobbly World of Banking

Mexico's money woes shake the international financial system

If you owe your bank manager a thousand pounds, you are at his mercy; if you owe him a million pounds, he is at your mercy. —John Maynard Keynes

Many of Keynes' economic theories are today in eclipse, but his shrewd observation on the relationship between bankers and borrowers still rings true. In fact, some of the world's leading financial institutions are painfully learning the accuracy of this aphorism. After having extended $845 billion in loans to debtor nations over the past decade, the bankers now...

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