A year ago you described the banks' success in stonewalling the regulators as "the quiet coup." How did the banks make out in the recent financial regulation bill?
I think the big banks have won. They won with a terrific smokescreen, so there's a lot of pretense. There's actually some sort of reform going on. But it's hats off to them. Too bad it hurts the rest of us.
A recent blog of yours talked about the next Chuck Prince running banking. What did you mean?
Well, Chuck Prince himself said to the Financial Crisis Inquiry Commission that he didn't really understand what was going on. So sooner or later, even the best-run banks will fall into the hands of somebody who doesn't know what he or she is doing.
You know, year before last if anybody was too big to fail, it was an insurance company.
Good point. The legislation we [wanted] would have put sieve caps on all financial institutions, not just banks.
You just got back from Beijing. What did you learn?
I was there during the G-20 Summit [in Toronto], and it seemed to me that the G-20 countries were assuming China will grow fast and that will give us space for our fiscal austerity without that being too costly. In China, they're much less convinced they can continue to grow at these rates. The biggest China bears I've met recently were in Beijing.