What's the free marketeers' answer to this?

One problem with the world economy as noted by one Australian born OECD economist:

Another factor which Dr Blundell-Wignall says is holding back the recovery from the GFC is bank earnings.

"If you go back to 1980 the earnings of the financial sector of the S&P 500 companies was less than 10 per cent."

He says the proportion of Wall Street earnings by finance stocks is now more than 30 per cent, having risen above its share when the GFC hit.

"The financial sector is supposed to be the sector that intermediates between real savers and real investors. That's what greases the wheels of capitalism," he said.

"Where do we get of thinking that the financial sector can just rip one third of the earnings for themselves?

That does sound like a legitimate concern, and apart from letting banks and financial institutions fall when a crisis happens (and impoverishing millions of their customers in the process), I wonder what the small government, let business work itself out, types think about this....