Thursday, February 12, 2009

Why Banks Aren't Lending

CNBC points out today what I pointed out back in December...banks aren't lending because regulators are riding herd on them in the field, regardless of the rhetoric in Washington. If I'm a bank, why would I lend out money when the old capital ratios might get tossed in favor of Geithner's new supra-regulatory "stress test"? I don't know what this stress test entails, I don't know the rules of the road. Better to hold onto the capital. Alas this escapes the geniuses in our government.

UPDATE: And then there is this...

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