Morning Business Memo

JPMorgan Chase CEO Jamie Dimon's appearance before the Senate Banking Committee today highlights a raging debate over the industry's future and government oversight. "The too big to fail banks that are so big, they threaten not only the financial system, but our entire economy," says Dennis Kelleher of the financial advocacy group Better Markets. "What's at issue is whether or not we are going to protect taxpayers' pockets or Wall Street's profits."

Kelleher says the huge trading loss at JP Morgan proves the need for more oversight - not less. But despite the near collapse of the financial system in 2008, the banking industry has many supporters in Congress and among libertarians and conservatives. They oppose rigorous government oversight of Wall Street, and say markets take care of severe losses.

"I would argue that risk management is better now because it has to be better," says Mark Calabria who studies financial regulation at the Cato Institute. JP Morgan Chase has already learned valuable lessons from its recent trading loss, he says. "So far it's more than $2 billion when they have more $200 billion in capital." America's biggest bank is expected to have a profitable quarter, despite what happened. "It certainly looks like this was not a risk to JP Morgan overall," says Calabria. But the banking industry's critics have an entirely different view of the bank's embarrassing trading loss.

Volatility continues for stocks. One day after a triple-digit loss for the Dow Jones index, stocks rebounded. The Dow, Nasdaq and S&P all gained more than 1 percent yesterday. The big price swings continue with uncertainty over Europe's debt crisis. Attention is also focused on Spain, where borrowing costs rose to euro-era highs yesterday, increasing concerns that it could need a bailout.

OPEC ministers are coming into a meeting deeply divided over how much crude to pump, with Saudi Arabia keen to keep a lid on prices, while rival Iran pushing to cut production. The 12-nation group is likely to paper-over differences tomorrow by deciding to leave output unchanged despite the current overproduction. Oil prices are down more than 25 percent from their recent peak.

American consumers are cautious about spending. For the first time in a year retail sales may have declined compared with the month before. That's the forecast from economists about today's retail sales report for May. The holiday shopping season late last year was relatively strong, but says Ed Farrell of Consumer Reports: "since then retail sales just slid month to month and that decline has really been led by the big ticket items things like major appliances and major home electronics."

Richard Davies Business Correspondent ABC NEWS Radio twitter.com/daviesabc