Shrink the beast, part 2

Some recent analysis suggests that the financial industry needs to shrink a lot to bring it back in line. Starting in the eighties, the industry exploded. As a result:

Roughly speaking, though, the securities sector still needs to shrink by a factor of about five before they get back to the size they should be.

With all that growth and money running through the industry over three decades, it's no wonder 1) everyone at the top looked like a super-genius captain of capitalism, and 2) super-sized compensation culture became the norm.