Morning Commentary
Lost in the mix this week is the latest report from the Federal Reserve on lending. January’s Senior Loan Officer Opinion Survey on Bank Lending Practices reveals that banks continue to tighten lending standards.
After a period where easing significantly outpaced the tightening of credit standards for loans, the banking industry flips the script.
The question is why?
If you answered with the Dodd-Frank Act regulations and restrictions, you would be right to a certain degree, but the overarching question would remain. Considering that the Dodd-Frank Act was signed into law on July 21, 2010, banks seem more concerned with lending over the past 18 months. I don’t think it’s a function of having to hold on to more capital, although it’s the answer the industry gives most often.
There was an Investor Conference in Miami on Tuesday, where the CEO of Goldman Sachs indicated that he’s ready to lend more.
Left to our own devices, we wouldn’t hold as much capital as we’re holding, certain belt-and-suspender elements of the regulatory framework put different constraints on different firms.
- Lloyd Blankfein
Morgan Stanley’s Chief Financial Officer weighed in on the overarching burden of complying with all the rules and regulations:
We started with rules that were one page that turned into 1,000 pages that require us to put in 20 or 30 thousand pages to show people that we’re complying.
-Jonathan Pruzan
I am not buying into this bellyaching. There is no doubt that the Dodd-Frank Act was overambitious and designed to knee-cap the banking industry, but more so to look out for consumers and would-be borrowers. Something tells me that banks are either worried about the economy and/or adding pressure to lawmakers to make changes.
Credit standards for mid-sized to larger firms ($50 million business+) continue to tighten more than easing, although the ratio has improved.
Credit standards for small firms (less than $50 million in business) are mostly unchanged as of late.
I really hope banks stop with all the nonsense. They got the trillion the Fed printed out of thin air after a public and secret bailout. It’s time to step up to the plate and start lending- let’s get America moving again.
-Charles V. Payne
Tough Earnings Patch
After the close on Tuesday, it was ugly! Earnings miss from big names were greeted with big selling, but things often change overnight.
Revenue and/or Earnings Miss:
Today's Session
Earnings continue to roll in this morning and the futures are in the red. Let's see how the morning trading goes.
Tweet |
4/25/2024 7:51 AM | THERE CAN ONLY BE ONE |
4/24/2024 1:30 PM | Earnings Flood In |
4/24/2024 9:26 AM | BUYING THE DIP |
4/23/2024 1:25 PM | Bloom Off Rose |
4/23/2024 9:32 AM | WHAT HAPPENED TO THE BRAVADO? |
4/22/2024 1:22 PM | Pins and Needles |
4/22/2024 9:30 AM | LIVE BY THE SWORD … |
4/19/2024 1:20 PM | Fair Chunk of Rotation |
4/19/2024 9:35 AM | DON’T OVERREACT |
4/18/2024 1:37 PM | Didn’t Break Down |
4/18/2024 9:40 AM | MARKET OFF SCRIPT |
4/17/2024 1:59 PM | Facing Pressure |
4/17/2024 9:37 AM | POWELL STILL WANTS TO HELP |
4/16/2024 1:35 PM | Muted |
4/16/2024 9:42 AM | FEAR ARRIVES |
4/15/2024 1:17 PM | Making a Statement |
4/15/2024 9:45 AM | Equal Opportunity Drubbing |
4/12/2024 1:37 PM | Pressure Overall |
4/12/2024 9:42 AM | WHO YA GONNA CALL? |
4/11/2024 1:38 PM | No Urgency |
4/11/2024 9:27 AM | Tough Sledding |
4/10/2024 1:22 PM | Hang In There |
4/10/2024 9:51 AM | HERE COMES THE LATEST RATIONALE FOR PERSISTENT INFLATION |
4/9/2024 1:56 PM | Fighting the Trend |
4/9/2024 9:46 AM | NEXT TIME, MAKE IT A HOLIDAY |
More commentary archives |
Home |
Products & Services |
Education |
In The Media |
Help |
About Us |
Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.
|