The bank stocks are at it again as they make another new 52-week relative performance low compared to the broad market. It’s a perennial issue. Over the last year the KBW Bank Index, an index of 24 of the largest US banks, has underperformed the S&P 500 by 30%. Over the last 10 years, the banks have returned just 51% as much as the broad market.
When the banking sector rolls up, it is the middle class that suffers. One can see it in these humongous ATM fees. AT this point the dye is cast, regulatory banking under the current regime will not last, and it is the banks who will want a better Fed contact.
Sorting this out will be a nightmare especially with 200 years of blundering banking theory. We are going to hear the endless refrain,"You said this time was different!".
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