JP’s Dimon asks Bernanke whether post-crisis rules holding back recovery

June 8, 2011 by · Leave a Comment
Filed under: Opinion 

I watched this full press conference yesterday on Bloomberg TV along with the questions after Bernanke wrapped up his 15 minute speech.  Mr. Dimon was the last question.  He wanted to know if there has been any serious analysis on the effects of the new regulations on banks post-crisis.   Being he is the head of one of the largest banks on the planet, he has his own reasons for asking this question.  It was a totally biased question for a man in his position.  I do agree that we don’t want to take draconian measures as a over-reaction to a crisis that was created by greed and lax rules with asleep regulators (not all of them).

Here is a link to the audio of the question: http://www.youtube.com/watch?v=-Gs3X1jQxVY

Bottom-line is that we have had many rules rolled over the last 25+ years that has helped build Wall Street into the machine it is today and to Mr. Dimon, you received assistance from the government like all other major banks so you should not be asking this question unless you have concrete evidence of some harm.  It feels like a slap in the face when I heard that questions.  It makes one think that maybe we didn’t learn anything and we are closer than we know to the next crisis because like I have said repeatedly, we will reap the precedence we have sown.

Bloomberg – JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimon asked Federal Reserve Chairman Ben S. Bernanke whether regulators have gone too far by reining in the U.S. banking system and are slowing economic growth.

Dimon asked whether the central banker has measured the cumulative effects of new capital requirements, mortgage standards and other rules imposed on the system in the wake of the U.S. financial crisis. Dimon, 55, spoke yesterday in a question-and-answer session after Bernanke addressed a conference of bankers in Atlanta.

Dimon asked Bernanke if he “has a fear like I do” that overzealous regulation “will be the reason it took so long that our banks, our credit, our businesses and most importantly job creation to start going again. Is this holding us back at this point?”

The Fed may hold the benchmark interest rate near zero into next year. The U.S. unemployment rate rose to 9.1 percent in May while U.S. home prices slumped in March to their lowest level since 2003, according to the S&P/Case-Shiller index of property values in 20 cities. Banks have tightened lending standards to what they were 30 years ago, Dimon said.

Source

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