Bashing bankers is always fun. Despite being an MBA, and a righteous advocate of free markets, the werewolf harbors a natural skepticism towards both bankers and lawyers. They make profoundly easy targets, mostly on account of their natural arrogance and insular thinking. Still, the werewolf realizes that bankers, more so than lawyers, offer one of the most valuable services to the health and prosperity of this nation and the world. They enable people to take risks and create opportunity by extending lines of credit and providing financing. That is why he is alarmed by the President's aggressive pivot, and new populist assault on this country's larger financial institutions. The Financial Times has solid coverage here.
The werewolf feels that these moves to create bogeymen via the bankers is a cynical attempt to play politics with this nation's crucial drivers of growth. As long as the bankers are beaten down and paralyzed by reckless and punitive legislation, they will be unable to lend or extend credit that is needed to drive growth. It speaks very poorly to the president's intentions about enabling opportunities for growth and reinforces the notion that the policy wonks in his administration have been sidelined by the political hacks.
Don't get the werewolf wrong. He actually doesn't like most bankers on account of their arrogance, master of the universe persona, stunted short term thinking, and militant alpha dog attitude. While pursuing his MBA, the werewolf briefly flirted with the banking profession, like all good unoriginal MBA's, but quickly realized that he and investment banking would be uglier than watching a great dane mount a chihuahua in heat. They screwed up by taking the TARP money and proceeding to pay huge bonuses, despite the macro-challenges facing the nation. That's their arrogance that he resents so much and the subject of a different post. Still, he loves the invaluable service bankers provide and knows that despite being easy targets, they are the farthest things from being the enemy, in fact, they are one of the most important allies to growth and prosperity this county and the economy have.
There is also this desire by the populists and the left to squirt all of the blame on bankers for the macro-crisis. This is a grand and dangerous illusion that if continually pimped, will exacerbate our collective woes. The bankers deserve a solid portion of the blame, and believe me you, the recent slaughtering of banking titans like Bear Sterns, Lehmen Brothers, Washington Mutual, Wachovia, and Merrill Lynch is evidence of that. However, let us not forget that a raft of thoughtless government policies that pushed the banks to issue risky loans or face punitive action, government sponsored entities like Fannie and Freddie Mae that distorted the market place, or the fact that millions of borrowers willfully misrepresented themselves on financial disclosure loan documents, all served to be the catalyst for the perfect storm that struck sixteen months ago. It's time to adjust the incentive structure and perhaps require different capital ratios for banks to make loans, etc, but beating them down even more helps no one at this point.
Assaulting and hating bankers isn't the solution. The president should know better. Shame on him. We have real enemies in the form of Al Qaeda, the Taliban, the Mullahs in Iran, Hugo Chavez, and the North Koreans. Let's keep that in mind as we move forward.
I'm Thankful . . .
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