When we were kids, the bedside poster beckoned with Browning: "Ah, but a man's reach should exceed his grasp, or what's a heaven for?"

As the earnestness of hippies has morphed into the cynicism of hipsters, this encouragement to dare to dream, and more so, dare to try, could be read as just so much psychobabble. But with every day and every banking-industry scandal that hits the headlines (nearly a dozen so far in July alone), I wonder, have we forgotten to even try to be good? Is this all that's left?

I asked my boss once, an expert in white-collar crime (as a detached observer), why they — the bad guys — did it. His response was basically that we're all capable of doing the wrong thing, it's really more a matter of opportunity. Some take it, some don't. Either there's a lot more opportunity these days or a lot more bad guys. Or both.

Receiving Wide Coverage ...

The Dark Knights Rise: Libor hijinks — and the accelerating investigations into them — remain the main thread uniting the financial press. The Wall Street Journal tells us the latest domino to fall from London tipped in a southeasterly direction, with two German banks — bellwether Deutsche Bank and the late WestLB — fingered in the raft of global probes into rate manipulations. Anshu Jain, the new co-head of Deutsche Bank, happens to have been in charge of its London investment banking operations. Not the kind of start one hopes for. The Financial Times notes that British regulators, late to the party, are revving up their probes. And the New York Times explains that hey, there's nothing scientific about benchmark rate-setting, anyway. It's all guesswork.

It Starts With Cutting Class: Attention is increasingly turning to student loans, and the Sword of Damocles it is becoming. The Wall Street Journal reports that the Obama administration wants Congress to make it easier for people to be able to walk away from some student debt by filing for bankruptcy protection. Note, the White House isn't talking about student loans financed by the federal government. Just the money lent by private companies. Either way, there's plenty of student debt to go around. Drawing a parallel between that market and the one for mortgages, the New York Times cited an administration report that total outstanding student debt last year exceeded $1 trillion. Roughly 15% of that came from private lenders.

Wall Street Journal

Tough day in the trenches for Morgan Stanley. Not only did its stock price dive more than 5% on a terrible earnings report, but it appears it will now be mired in a valuation battle with joint venture partner Citigroup over the worth of Morgan Stanley Smith Barney. Morgan Stanley believes the value of the brokerage is a good deal less than what Citi thinks it is — naturally — as Morgan Stanley wants to buy more of it. Out of the other side of his mouth, Morgan Stanley chief James Gorman says he wakes up every day "delighted" the bank did the deal.

Financial Times

Morgan Stanley, by the way, is cutting another 4,000 jobs. It's not the only bank with a fresh move in that direction. Citi is whacking 350 bankers and Deutsche Bank is going to lay off about a thousand. If less is more, consider that one way to fix the industry's broken moral compass.

Correction ...

The email version of Thursday's Scan bungled the full name of the FSOC (the "c" is for "council," not "commission") and misidentified the regulator's second annual report as its first one.


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