Mike Mayo is urging Jamie Dimon to fix the banking system before others do it for him in a new op-ed for the Financial Times.Mayo, currently a financial analyst with Credit Agricole’s CLSA unit, came to prominence in 1999 when he gave many big name banks sell ratings and proved to be right. He did that again in 2007.
While acknowledging the strides banks have made to boost capital levels and shed risky assets, he says Americans continue to view the sector with vehemence. And that’s fair.
Either we take stronger steps to ensure the integrity of the banking system on our own, or outsiders will press for more regulation and oversight. Or we have free markets that function effectively, or Congress, lawyers and the Occupy Wall Street movement will keep the pressure on. And rightly so …
If those outside the financial sector take over the process of cleaning up Wall Street, it will be more unpleasant and indiscriminate. As banking becomes ever more complex, outsiders have correspondingly less insight into the internal functions of major global banks and are likely to use blunt and potentially less-effective tools to try to control these huge companies.
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