Krugman: Banks Are Not OK

Don’t be fooled, Paul Krugman warns in latest column: Despite the large profits reported by banks like J.P. Morgan and Goldman Sachs last week, the banks are not OK. Citigroup and Bank of America both reported losses again and “while the wheeler-dealer side of the financial industry, a k a trading operations, is highly profitable again, the part of banking that really matters—lending, which fuels investment and job creation—is not.” The administration, for its part, has begun to take a harder line against the banks. “Administration officials are furious at the way the financial industry, just months after receiving a gigantic taxpayer bailout, is lobbying fiercely against serious reform,” Krugman writes.