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Cramer: Richard Cordray May Be Banks’ Worst Nightmare

Richard Cordray, the former Ohio attorney general nownamed to head the Consumer Financial Protection Bureau, may turn out to be the banks’ worst nightmare, Cramer said Monday.

Cordray was named to the top job by President Obama after months of speculation that Harvard Law professor Elizabeth Warren was in line for the position.

“[Banks] were thrilled because they feared the unflappable Warren, who had frequently expressed contempt and anger about the banks and their executives, would decimate bank earnings and serve as a nationally appointed nemesis of the financial industry.”

But any the relief the banks are feeling right now is premature, the “Mad Money” host said. That’s because Cordray, as attorney general of Ohio, has taken aim at the national banks and has been a big supporter of the rights of borrowers against the lenders.

“I think that Cordray will be both for cuts in both interest and principal, something that will annihilate the banks' meager earning and stand the whole mortgage business on its ear,” Cramer said.

So bank investors shouldn’t be so quick to come out of the fallout shelter, he said, because Cordray's going to be the defaulting borrower’s best friend.

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