Comment, analysis and other offerings from Thursday’s FT,
John Gapper: Madoff’s sentence is necessary and rare 
There was a moment during Bernard Madoff’s sentencing hearing in Manhattan on Monday when it became obvious that the 71-year-old fraudster was going down for a very, very long time indeed.The 71-year-old fraudster’s conduct was indefensible and he deserved what he got. But the case was unusual. The question is whether Bernard Madoff’s spectacular sentence should become the benchmark for future cases of corporate fraud.
Analysis: Exiting the dragon
When Bank of America was negotiating to take a stake in China Construction Bank four years ago, write the FT’s Sunny Tucker and Jamil Anderlini, advisers who worked on the investment gave it the code name “Project Solidgold”. Yet the landmark “strategic” relationship between the US and Chinese lenders has conspicuously failed to glister. BofA was among a wave of overseas financial institutions that in recent weeks sold down their holdings in their Chinese counterparts as soon as lock-in periods expired.
Willem Buiter’s Maverecon blog: Harmful financial innovation
By early 2006 I knew that the global financial system was on an unsustainable trajectory that would end in tears. But I had no idea about the scale of the excesses, the scope of the mispricing of risk and the crazy ultimate distribution of the risks – often right at the backdoor of those who thought they had sold it. I never anticipated, even when the crisis started in August 2007, that by late 2008, most of the crossborder banking system in the north Atlantic area would be insolvent, but for past, ongoing and anticipated future financial support of the tax payers.
Market Insight: Risks of currency intervention
Writes Mansoor Mohi-uddin, director of FX strategy at UBS: Intervention is making a comeback in the currency markets. Two years of credit crunch and global recession have made currency markets highly volatile, inducing policymakers to react to record swings. Currency markets are in effect returning to the era of “dirty floating” that prevailed in the 1970s and 1980s.
John Authers’ Short View video: the past 12 months
The last twelve months in review, across asset classes, volatility measures and default risks.
Lex on gloomy manufacturers
It is incredible that 19 months into such a nasty recession plenty of economic indicators are still getting genuinely worse. Take Wednesday’s survey of US manufacturing conditions from the Institute of Supply Management. Most will rejoice that the factory index rose slightly to 45 per cent in June, in spite of such levels remaining consistent with a shrinking economy. But a peek beneath the headlines reveals that manufacturers are far from cosy.
Lombard: a Win-Win situation
“So – candidates to chair Lloyds. That is one of ours, isn’t it?” “Yes, Chancellor. We’re thinking Win Bischoff.” “Bischoff – good choice. Ex-Citigroup chairman, right? Is Citi one of ours?” “One of theirs, Chancellor.”