Warren Buffett's $5 billion investment in Bank of America Corp. was truly daring. It brought him a strong, instant return, and gave BofA an air of desperately-needed stability.

With a move brimming of certainty and lacking any hesitation, Buffett essentially said, "I believe in this company." He is the only investor alive whose stamp of approval can so directly boost the value of a stock in his own portfolio.

More indicative of his legend is what the purchase meant for Bank of America's health. It had such an upfront restorative effect on the bank that an act so plainly self-serving was at the same time viewed as heroic, almost altruistic.

What is ironic, however, is how unwilling banks such as B of A seem to take a page out of the Buffett playbook and go out on a limb themselves.

One look at the Federal deposit Insurance Corp.'s recent Quarterly Banking Profile shows a banking sector that has apparently lost its nerve. The actual increase in loan balances - which broke a streak of several quarters in which loans decreased - was negligible.

The loan category with the biggest growth was credit given to banks, due to affliliated financial institutions lending to each other. Institutions were generally after the safest, risk-free assets they could find. The most evident sign of banks' reticence may have been the huge increase in balances at the Federal Reserve banks.

In short, banks are playing it safe, apparently content to wait for the economy to improve all by itself. In a way, the economy has become something like a four-way intersection. Everyone is motionless, waiting for a car at another stop sign to move first before accelerating, or praying for the Federal Reserve to magically appear and direct traffic.

But there will be no recovery if banks can't start lending again.

I understand why they are hoarding capital and liquidity, of course. Following the financial crisis, banks are still adapting to the heightened regulatory atmosphere under Dodd-Frank and dodging new obstacles like the U.S. credit downgrade. I don't blame them for being cautious.

Still, the time has come for bankers to lead the pack, even if it means taking some risks.

In the current environment, if the industry is expecting a sure thing to emerge before it gets back to the business of lending, it may be wasting its time.

Another housing or tech boom is nowhere to be seen, repealing Dodd-Frank is a pipe dream and international capital rules will be a moving target for the rest of our entire lives. Relying on stimulus such as another round of bond purchases by the Fed is also completely out of whack with a financial industry that also abhors government getting in its way.

Moreover, nothing the government has tried to date to spur growth has made any noticeable impact.

Lately, amid so much adversity - highlighted by the massive litigation risk banks still face from the 2008 crisis - banks seem to lack the innovation needed to move beyond it.

Imagine, if you will, the following alternative scenario. A group of the largest, most well-capitalized banks in the country get together and make the following public statement: "We believe in the growth potential and franchise value of the U.S. manufacturing sector enough that we are investing X billion of the astronomical amounts of liquidity we now hold into it."

Manufacturing companies are not demanding such a statement, because, as the argument goes, they are not planning to expand.

But, just like Bank of America said it didn't need more capital, manufacturers would be foolish to turn down a declaration of faith from a heavyweight financier.

Regulators would surely scrutinize such a commitment, concerned that the banks had not sufficiently underwritten the deal. But regulators want banks to grow their balance sheets more than anyone.

Like Buffett, a high-profile loan to a blue-chip company could pay a bank dividends on the front end, and provide a public-relations coup on the back end.

Of course, a more likely scenario is we all sit at the four-way stop a little longer, and either a new unexpected growth sector emerges or we all start to move in reverse.

Or maybe, just maybe, a bank will follow Warren Buffett's example.