it's not a regulatory problem. It's a fear of regulatory issues and the current bank regulatory environment. The FDIC will kill a lender in a heartbeat over a business credit line. The even larger problem is the lack of clarity about total taxation and massively escalating employer expenses.
The demand side hasn't fallen apart, much to the chagrin of guys like Obama. The jobs problem is more about international competition, outsourced manufacturing and worthless younger generations than it is demand. Without demand, GDP would wither away, especially with no RE transactions to drive it some. It hasn't evaporated, which you're suggesting.
