It’s getting ugly in Davos. As we wrote previously, everybody is mad at everybody and the booze is missing, which is not helping people’s mood. (Except for Vikram, who, as a commenter noted, looks in the CNBC interview “like he’s sitting in the Zen garden of his dreams.”)
“Both the banks and the regulators think they hold all the cards,” said Harvard Economics Professor Kenneth Rogoff. “The bankers think that when the storm passes nothing will have changed and they can go back to business as usual. Regulators think banks have completely lost the political capital and are ignoring public opinion.”
In what increasingly looks like a Shakespearean drama, bankers are busy plotting schemes to avoid additional regulation, but they’re divided about which route to take and which regulation is more threatening.
Meanwhile, worldwide regulators and policy makers are presenting a more united front on most of the issues- the comp one being one of the thorniest- and are ready for the ultimate face-off.
And this is what Barney Frank, who also made the trip, had to say about it today. “The big banks, if they think they’re in a position to stop the regulation, they’re deluding themselves.”