Ken Chenault's State Of Denial On CNBC

I caught some of American Express CEO Ken Chenault's happy talk on CNBC this morning.

In my prior posts on the company, found under its label along the right side of the main page, I have catalogued some of the outrage that Chenault triggered by his firm's summary severing of account relationships with long time, non-delinquent customers.

This morning, he was all smiles and reporting falling chargeoffs.

But if you look at the nearby, five-year chart of Amex's and the S&P500 Index's prices, you can see that the firm has been struggling for nearly two years with anemic performance.

As long ago as early 2006, the company's return had begun to trail the index, and it's never recovered.

Thus, simply blaming last year's credit crisis is disingenuous.

It also begs the question of how Chenault's knee-jerk credit withdrawal decisions may have inflicted long term damage on American Express' brand name and earning power going forward.

Chenault confirmed that, despite having taken refuge in a commercial banking license, when his firm took federal cash to avoid bankruptcy, it has no plans to become a full service banks. Instead, he spoke of regionally-based growth through, one supposes, credit card relationships.

Isn't this more proof of excess capacity in the financial services sector? And, perhaps, that Amex should have been closed or merged with a healthier, broader financial utility?

Instead, all Chenault hopes for is to regrow charge card volumes and customers. Granted, it may be better than moving headlong into physical branch banking or other activities in which the firm has little or no experience or expertise. But simply changing direction on credit provision doesn't seem that creative, or worthwhile, in the greater scheme of US banking, does it?

I wonder how realistic that is, in view of Amex's recent shedding of so many paying, charging customers only a few months ago?