Obama jawbones banks to lend more, back new regs

[BloodEclipse]

Obama jawbones banks to lend more, back new regs
Dec 14 06:45 PM US/Eastern
By TOM RAUM
Associated Press Writer
WASHINGTON (AP) - President Barack Obama implored top bankers Monday to help keep the fragile recovery from faltering by boosting lending to small businesses and getting behind an overhaul of financial regulation. "We rise and fall together," Obama declared.
In response to the president's burst of populist jawboning, some banks pledged to increase loans and exercise more self-control over outsized compensation. But the full impact of Obama's intervention was hard to gauge: The government is losing leverage as major banks repay bailout loans.
Obama's lecture to the bankers was also part of a broader election-season Democratic effort to tie sluggish bank lending to continued high joblessness—and to try to tie the banking industry to Republican efforts against Obama's financial overhaul legislation.
It's a tough balancing act, given past contributions of big banks to Democratic as well as Republican candidates.
Obama called his message a simple one: "America's banks received extraordinary assistance from American taxpayers to rebuild their industry, and now that they're back on their feet, we expect an extraordinary commitment from them to help rebuild our economy."
He urged bankers to "explore every responsible way" to boost lending and to "take a third and fourth look" at every loan application.
The bankers said they got the message.
But they also insisted they are getting conflicting messages from Washington when the do try to make more loans. While the White house presses for more lending, regulators are cracking down on banks to lend more prudently and forcing them to keep larger cushions of capital to protect against future losses. That means there's less money available to lend. The meeting came amid growing friction between the president and the banking industry, a day after Obama denounced "fat cat bankers on Wall Street" who enjoy big bonuses but "just don't get it."

Rest of the story: http://www.breitbart.com/article.php?id=D9CJBVU80&show_article=1

What they say and what they do are not the same thing. This is about class warfare and creating "FAT cats" and "BIG".... fill in the blank... business, oil etc.

 

[jedi]

The other "part of the problem" is that I6BO FORCED the big banks to take the TARP $$$ it is the smaller/local banks that are the ones that give out the majority of loans to small biz. NPR has a report on this yesterday that said that the smaller banks for the majority have refused to take any TARP money since it comes with too many strings and they are afraid of what I6BO/DC will want them to do. As such the smaller banks continue to play a wait & see approach and do not want the FEDs help.

 

[melensdad]

The OTHER part of the problem is that small businesses don't want to borrow if they can't pay it back.

So why borrow money when customers won't buy the goods? And if customers won't buy the goods then there is no way to pay back the loan. Therefore there is no need to borrow the money.

Further, and I know a lot of small businessmen, none of the small businessmen I know of deal with the banks he was preaching his word to. He was talking to the presidents of Mellon Financial and the top handful of banks in the nation that deal with consumer credit cards as well as large international companies. Most small businesses I know deal with local or regional banks. I think he was talking to the wrong group of bankers.

 

[jedi]

BINGO!!! BINGO!!! melensdad! But remember he needs the credit card "market" to unfreeze so that the sheep can continue to use those plastic cards and buy, buy, buy... Problem is the sheep are moving back to CASH and dropping the plastic since it's MAXED out.

 

[Ramen]

Just as long as they don't put all that money into the system until after I buy my seeds and plants!

Then I get to watch the total destruction of the middle class while eating kale and scything my grass.

 

[Mike_M]

Hmmmm, Let me see if I have this right:

1) Government forces banking industry to "ease up" lending rules and make loans to unqualified people.
2) Economy goes south and many of the loans go into default.
3) Government has to bail out banking industry because they are "too big to fail"
4) Now we return to 1)

Anyone see anything wrong with this?

 

[Robert Richardson]

Nobama doing what what he does best -Jawboning!

 

[CulpeperMM]

Hmmmm, Let me see if I have this right:

1) Government forces banking industry to "ease up" lending rules and make loans to unqualified people.
2) Economy goes south and many of the loans go into default.
3) Government has to bail out banking industry because they are "too big to fail"
4) Now we return to 1)

Anyone see anything wrong with this?

Wash, Rinse, Repeat...