Did you hear what U.S. Treasury Secretary Timothy Geithner had to say about lending practices today?
In an interview on National Public Radio, Geithner was quoted saying the following:
"The risk is that the pendulum having been too soft and easy on the lending side, the risk is that banks over-correct or that supervisors over-correct and that's something we need to lean against because the strength of recovery will depend in part on credit being available to businesses."
It is interesting to hear him publicly admit how bank lending has gone from one extreme to the other. From the outside looking in, Geithner can clearly see how excessively tight lending practices from banks could be a real hurdle to the health of the economy.
What Geithner fails to recognize is that banks are more restrictive not of their own accord but because the government has wielded their will onto banks through legislation and government oversight.
If Tight Lending Threaten U.S. Recovery, What Can We Do?
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