More Meredith Whitney: Investors should avoid banks at all cost…
Money quote- “Politicians have proven far worse than our worst expectations,”
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Investors should “avoid financials at all costs, particularly in the banking sector” because the Senate’s financial reform bill will end up restricting credit and hurt bank earnings, well-known banking analyst Meredith Whitney told CNBC.
…Whitney cited two new credit card rules in the Senate bill as particularly onerous. One would force banks to comply with individual state caps on credit card interest rates. The other would regulate how much credit card issuers could charge merchants for using their cards.The state caps on interest rates, she said, could make rates in one state lower than in another, causing banks not to lend in certain states.
“It’s going to make accessing capital so difficult for pockets of the country,” she said, particularly for small businesses that often depend on credit cards for funding….