The crisis is over, Dimon told Bernanke. We beat it. Bad companies got taken over (several by his bank). Home-loan standards have been tightened, like they were in the old days.
You now need a job, and savings, to buy a house. Banks have fat piles of money in reserve for the next crisis. Even the wayward derivative securities markets have crashed back to reality.
And yet, Dimon complained, government
agencies keep posting tough new rules on top of laws passed by the last Congress.
The government wants banks to set aside ever more capital. It wants limits on fees. It's trying, clumsily, to fix all of the problems that bankers such as Dimon believe have already been solved.
Maybe it's no coincidence, Dimon suggested, that "job creation isn't growing again."
He phrased it as a question: "Is this holding us back?"
He asked, of the regulations, "Has anyone bothered to study the cumulative effect of all these things?"
"I can't pretend that anybody really has," Bernanke admitted.
Bernanke failed to say, in so many words, "We need new rules and laws, because we can't trust you guys not to get out of control and wreck yourselves again, Jamie."
Out of the way
Dimon's right, says bank-stock analyst Richard X. Bove. "Hysterical congresspeople and born-again regulators have single-mindedly pursued an attack on the banking system, totally unmindful of the impact" on the economy, he told clients of his firm, Rochdale Securities L.L.C.
The Fed should require less reserves, not more, so banks feel free to lend, Bove added. He doesn't believe the Fed's "quantitative easing" - its purchase of Treasury and mortgage bonds - prevented deflation.
