The back and forth over President Obama's "praise," or whatever you want to call it, for Jamie Dimon and Lloyd Blankfein via an out of context Bloomberg take is really overdone.

Worse, it misses the fact that Larry Summers seems to have (emphasis on "seems") a road to Damascus moment.

Remember, this is the guy who helped dismantle the last vestige of Glass-Steagall as Clinton Treasury Secretary in 1999, and blocked the regulation of derivatives that Commodity Futures Trading Commission chairmen Brooksley Born sought a year later.

He also memorably dismissed the issue of moral hazard in an FT column before Obama's election as a serious concern, arguing via absurd analogy that fire insurance doesn't encourage homeowners to burn down their own houses.

But now Summers is saying banks should not only not be too big too fail but their dominance is distorting the economy. The fact that Summers is talking almost as tough as Tall Paul Volcker could be meaningful, because he's the guy running the economic show.

That makes me wonder again about Tim Geithner's future. But that's not the real issue here, as Summers is ultimately a bigger deal in the administration than Geithner is.

And if Summers has really changed his tune about bank regulation, that's something, though of course it remains to be seen whether Congress can be strong-armed into going along.

One banking lobby argument against tougher regulation is about to go out the window, it seems, and that is the threat, I mean, the "warning," that banks will move elsewhere if the U.S. cracks down.

Indeed, based on this report, it looks as if the only place that won't be doing the same thing would be Mars. Hey, there's a thought.

Good luck with that "unintended consequence" bromide, dudes.

And yeah, maybe Obama's messaging is out of control here, but in the end, policy trumps PR, not the other way around, despite all the Beltway/Wall Street media machinations.