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Mendon Capital Advisors president Anton Schutz weighs in on bank regulation and his outlook for the financial sector.
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-- -- JPMorgan's.
Chief Jamie -- apologizing.
For that multi billion dollar trading loss.
But also stepping up in -- back off when it comes to attacking the bank.
And saying that there's more regulation made he said all this at the world economic form.
In Davos Switzerland -- -- is your way and he said.
Chief investment officer in the new capital advisors -- -- rot -- New York may be the only place on the planet where it's colder than Harry Evans is hitting -- right now and -- -- that -- -- Happy to be here -- -- anti what -- stated Jamie Dimon he's like listen.
He would there was one in particular one hedge fund manager who went after him and he basically said -- back off -- we are heavily regulated and where.
Better capitalize may -- than we've ever ban.
Well Jamie's Jamie's right about the capitalization he's got incredibly strong capital.
A lot of standards force the banks have more capital have more liquidity.
And quite frankly it really is about rules and in some of the most simple rules for the most important ones for one.
Thank -- more capital OK they've met that.
To thank should have stronger loan loss reserves and they should carry them through bad times and good times.
And I think we had a problem that they -- carrier preserved during the last cycle.
And and the -- the last rule is when government start to metal and incentivizes banks to do things for instance.
The government incentive US banks to buy Fannie and Freddie preferred by saying hey you have to carry less capital by the way -- he'll there -- so encourage the banks don't -- And then of course they got wiped out -- those positions and in Europe give the same situation where all the European banks.
Could carry sovereign debt and again they were courage to do so that less capital requirements.
Again that idea for those banks so.
It's not just the rules -- Smart rules it's important that capital is there.
And -- -- a pretty good job other than the whale.
Yeah other than that one loss but -- to that point if you look at broadly speaking.
How financial stocks have done in the last year best performing -- your major sectors in the hasn't paid.
It's something that's overlooked by many but can that continue -- think in time.
We're.
Well -- I think he can continue there's nothing more economically sensitive than the banks and really the fly in the ointment here is the debt ceiling and I think if we get through the debt ceiling here in the United States without a lot of damage well a lot of bills not -- indicator promises being that.
Then I think the economy's actually poised to do reasonably well in the banks are still very cheap particularly the big money center banks.
Relative to any sort of normal valuations and I think it really benefit from IPOs coming back and equity markets can either be a resilient.
-- -- great to talk to as always be well stay warm -- -- have -- big pop because they're not pretty but they have a they work pay anti take care.
