The central proposal of the Vickers Commission, backed by the chancellor, is to separate out the big bank's retail banking operations - the bits that run boring old savings, mortgage and cheque accounts - from their investment banking activities, or so-called "casino banking".
The crucial thing in this is that the banks will be allowed to stay legally whole, just as they wish, and not forcibly broken up in the way that, one suspects, the Business Secretary Vince Cable and the Governor of the Bank of England, Sir Mervyn King, might still quietly wish.
Banks will instead be asked to hold more reserves in different places in case things go wrong; not allowed to "gamble with your money"; and the taxpayer guarantees will be limited to the retail stuff. Thus we will end "too big to fail".
Will we? Like many official bodies over the years the Vickers Commission has interested its terms of evidence as a writ to allow the authorities to have their cake and eat it; in this case to keep our vibrant wealth creating financial services, but avoid the blow up that has cost us so dear. Their solution sounds plausible, but Sir Mervyn for one gave a notably uneffusive welcome to "ring fencing", observing merely that a "change in the structure of banking" is required and that "I await with interest" their final recommendations.
He remains, I suspect, to be wholly convinced that a complete legal separation of banks' high street and other functions might not be safer all round, and with little cost or inconvenience to customers. After all, for seven decades after the Wall Street Crash the United States' Glass-Steagall Act, named after the Congressmen made it illegal for investment banks to own retail banks and vice versa. It was copied around the world and it served us well until its abolition in the 1990s: There were few major banking crises in the US or Europe between 1945 and 2007.
Maybe the financial tsunami we suffered in 2008 was to great for any regulatory seawall, but such rules might have prevented some of the damage. If so, they would have been highly cost effective, given that the British taxpayer has had to provide total support of £1trillion (£1,000,000,000,000) to the financial sector.
The lesson of the last few years is that the ingenuity of bankers and their determination to abide by the letter but not the spirit of the law knows no bounds. Indeed, such mischief is regarded as legitimate "regulatory arbitrage".
The Vickers rules would be no different. In the City of London, as in Manhattan and elsewhere they employ - literally - rocket scientists to evade regulation - a cat and mouse game the authorities can't win. We should let the investment banks float off on a speculative island, pay themselves mad bonuses, take mad risks, and make and lose fortunes, just like the casinos of Monaco do. But they should have as little to do with the real economy as possible.