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Thursday, December 17, 2009

President Obama Clueless On Banking

Is President Obama as clueless as he appears when it comes to banking? Well, according to Tom Brown, President of, he's even moreso. According to Tom:

President Obama’s ignorance of how banking works seems to be nearly encyclopedic. He accuses the banks he spoke with Monday of playing a big role in causing the credit crunch. For the most part, they did not. (The main culprits have all long since collapsed.) He says the big banks should be grateful for the “extraordinary assistance” they received from the government. But except for Citi, none of the big banks even wanted the money. He keeps pushing this misbegotten Consumer Financial Protection Agency. But the effect of the CFPA would be to constrict credit, not expand it. His understanding of reality seems to be upside down and backwards.

It’s also a jarring to hear the President talk about the “extraordinary commitment” he expects lenders to now make. The last time the government wanted that kind of concerted effort from the lending industry, things didn’t turn out so well. Then, the goal was the expansion of home ownership—everyone from President Bush to Barney Frank was all for it—and the key tool banks used to get there was an emphasis on subprime lending. I don’t need to remind you how that ended.

So first he's clueless on healthcare, and now financials too? Oh well - these two sectors only represent 35% of GDP.