The entire series of efforts to rescue the banking system were so flawed, partly because those who were somewhat responsible for the mess--as advocates of deregulation, as failed regulators, or as investment bankers--were put in charge of the repair. Perhaps not surprisingly, they all employed the same logic that had gotten the financial sector into trouble to get it out of it. The financial sector had engaged in highly leveraged, non-transparent transactions, many off balance sheet; it had believed that one could create value by moving assets around and repackaging them. The approach to getting the country out of the mess was based on the same "principles." Toxic assets were shifted from banks to the government--but that didn't make them any less toxic. Off-balance sheet and non-transparent guarantees became a regular feature of the Treasury, Federal Deposit Insurance Corporation, and Federal Reserve. High leverage (open and hidden) became a feature of public institutions as well as private. Worse still were the implications for governance. The Constitution gives Congress the power to control spending. But the Federal Reserve was undertaking actions knowing full well that if the collateral that it was taking on proved bad, the taxpayer would bail it out. Whether the actions were legal or not is not the issue: they were a deliberate attempt to circumvent...
Tag Archives | Bank Outrage
America's Main Street community banks -- the vast majority of which avoided the banquet of greed and corruption that created the toxic economic swamp we are still fighting to get ourselves out of -- are struggling. Why don't we take our money out of these big banks and put them into community banks? What would happen if lots of people around America decided to do the same thing?
There’s no one individual out there who been more on the ball about this financial “crisis” and the inherent/subsequent corruption than Matt Taibbi. I recommend reading all the work he’s done for Rolling Stone in the past year. Here is his latest article:
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Barack Obama ran for president as a man of the people, standing up to Wall Street as the global economy melted down in that fateful fall of 2008. He pushed a tax plan to soak the rich, ripped NAFTA for hurting the middle class and tore into John McCain for supporting a bankruptcy bill that sided with wealthy bankers “at the expense of hardworking Americans.” Obama may not have run to the left of Samuel Gompers or Cesar Chavez, but it’s not like you saw him on the campaign trail flanked by bankers from Citigroup and Goldman Sachs. What inspired supporters who pushed him to his historic win was the sense that a genuine outsider was finally breaking into an exclusive club, that walls were being torn down, that things were, for lack of a better or more specific term, changing.
Hidden fees, skyrocketing interest rates, bankrupt consumers. FRONTLINE correspondent Lowell Bergman investigates the future of the consumer loan industry amidst an ongoing battle over increased government regulation. The Card Game airs Tuesday, Nov. 24 at 9 PM on PBS (check local listings or watch online).
In an attempt to squeeze more revenue out of consumers who don’t rack up much debt, Citigroup, Bank of America, and other credit card companies are adding new fees. According to USA Today credit card users are being hit with new “inactivity fees” and fees for not putting enough debt on your credit cards. Consumers thinking about canceling their cards face taking a hit to their credit scores for closing an account.
Other consumers may have no choice – Citibank has been closing some credit card accounts without reason or warning, damaging their customers credit ratings.
I cut-up my credit cards last night.
Joe Rauch of Reuters writes:
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Dalton Chiscolm is unhappy about Bank of America’s customer service — really, really unhappy.
Chiscolm in August sued the largest U.S. bank and its board, demanding that “1,784 billion, trillion dollars” be deposited into his account the next day. He also demanded an additional $200,164,000, court papers show.
Attempts to reach Chiscolm were unsuccessful. A Bank of America spokesman declined to comment.
“Incomprehensible,” U.S. District Judge Denny Chin said in a brief order released Thursday in Manhattan federal court.
“He seems to be complaining that he placed a series of calls to the bank in New York and received inconsistent information from a ‘Spanish womn,'” the judge wrote. “He apparently alleges that checks have been rejected because of incomplete routing numbers.”
Chin has experience with big numbers. He’s the judge who sentenced Bernard Madoff to a 150-year prison sentence for what the government called a $65 billion Ponzi scheme.