Stephen Schwarzman, the founder of the Blackstone Group and one of the richest people in the world, is worried that bank bashing and uncertainty in financial reform could force banks to decrease lending.
In an interview with Bloomberg TV from the World Economic Forum's annual gathering at Davos earlier this week, Schwarzman said the wrong kind of political dialogue -- and the wrong kind of reforms -- could damage bank confidence. "Financial institutions could start cutting back in terms of the extension of credit, and that could hurt global growth," Schwarzman said.
When asked what his biggest economic worry is right now, Schwarzman said:
"My biggest concern is that, as a result of either proposals or tone, that financial institutions are going to feel under siege and their going to retreat with their extension of credit. There is enormous uncertainty, not so much in the economic environment, but we've also increased the uncertainty from the political environment directed at the banks. And there is a really good probability that banks, starting in the U.S., but also on a broad basis may start to restrict credit simply because the uncertainty and the tone against them is so difficult that they may lack the confidence to just start doing their normal function."
Schwarzman added that "we don't need [banks] feeling insecure" and or feeling as if they are "attacked."