Sheila Bair is on a tear.
The FDIC chair recently noted that some bank managements will have to go. She obviously wasn’t talking about banks that have nothing to do with the TARP plan, or banks who are rushing to pay back the money because of what Wells’ CEO Kovacevich called the Government’s “asinine” attitude. No, it would have to be Bank of America and Citigroup, the poster-children. And their Boards as well.
Although the FDIC has since issued “clarifications,” Bair’s signal came through loud and clear: you big banks messed up, and we’re taking it out of your hides. By scapegoating the big banks, Bair both ignores and re-writes history: the financial crisis was foisted upon us by greedy bankers. Fire them and the problems will be solved. That might be true, except for the errors of consumers, Congress, investors, the Chinese, the Fed, the press, and-oh yes-even regulators. You gonna fire all them too, Sheila? Sheila?
Douglas R. Tengdin, CFA
Chief Investment Officer
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