The Other I

January 10, 2015

Banks not to bank on

Filed under: Just Stuff,The Economy: a Neophyte's View — theotheri @ 4:09 pm
Tags:

I was dumbfounded to learn earlier today that the  U.S budget bill passed by the U.S. Congress several weeks ago managed to sneak in a provision that would once again bail out banks that are “too-big-to-fail” if they get into trouble.  But this time, if Citi or Chase or any of the other big investment banks face insolvency, they will be permitted to take their depositors’ cash in savings accounts and CDs and replace with them a bank stock certificate — which may, of course, be of dubious value.  This applies even to deposits that are FDIC insured.

That’s bad enough.  But I also learned that banks may once again be on the edge of the same kind of disaster that floored them in 2008.

Deutsche Bank thinks that the falling oil price could trigger a huge wave of defaults because banks have lent so much money – more than a trillion dollars – to fracking companies which are now in deep water way over their heads.  To make a profit, shale gas and oil needs oil to sell on the world market for a minimum of $85/barrel.

It is now selling for under $50.

It’s nice to be able to fill one’s car with gas for so much less than it cost six months ago, or keep the house warm this winter.  And one can’t help but feel that Putin deserves to be in as much trouble as he is.  And it may encourage Iran to reach a compromise concerning its nuclear capacities.

But I wouldn’t leave any substantial savings with a big U.S. investment bank.  For the record, the ten biggest are Goldman Sachs, Morgan Stanley,  JPMorgan Chase, Bank of America Merrill Lynch, HSBC, Deutsche Bank, Citigroup, Credit Suisse, and Barclays.

Advertisements

7 Comments »

  1. Amen. Have you seen Sen. Elizabeth Warren’s remarks?

    Like

    Comment by Thomas J. Hubschman — January 10, 2015 @ 8:57 pm | Reply

    • I have read rather than listened to Warren’s remarks (I remember what I read so much better than what I hear), and agree. In fact, I was going to write my post about her views today, but the banks got in there first. My only concern about Warren is that she might not yet have enough experience to handle the presidency. And we need her in the Senate. But right now, she’s streaks ahead of any other alternatives I see right now for 2016.

      On Sat, Jan 10, 2015 at 8:57 PM, The Other I wrote:

      >

      Like

      Comment by Terry Sissons — January 10, 2015 @ 9:02 pm | Reply

  2. yes, and Wells Fargo. Elizabeth Warren, D-Mass, railed against this but many Dems joined the Republicans to pass it. One thing you can count on with the Dems…they can be so accommodating. They just believe so much if bi-partisanship (and thealmighty dollar)and the media barely covered the debate in congress…and barely announed it when it was thru and we all were sold down the river. If I hadn’t read my left wing b.s. on-line I’d not have known. (Yes, much of the left wing is b.s. too…just like the ight wing…how can we find out anything anymore??)can’t read everything in the NY Times…it is so big and of course also biased……plus, I have to do Soduko…or Sudoku…never sure. We are in a comma here and the media and gov’t are wholy owned subsidies of the bankers. That’s the truth. (oy oy oy! but we are going to keep railing with Elizabeth Warren…and then when it all crashes we’ll all be poor together…and when finally there is nothing left to lose, we may rebuild our country. Or we may succumb to mass violence. Stay tuned. I turn to meditation…now every single morning…I may add evenings. I refuse to be angry, sad, depressed and I refuse to give up. I often wonder if any of these people in charge have any clue that life is short and they could be so much happier if they just had more fun! Meanwhile it has been cold and the homeless are in need of more blankets. (Not housing, mind you…blankets…for under the bridge). I don’t get it. Love, Beth Date: Sat, 10 Jan 2015 16:10:02 +0000 To: juniper1940@hotmail.com

    Like

    Comment by E Bastasch — January 11, 2015 @ 2:01 am | Reply

    • Oh Beth, I know! But I worry that too many hopes will be piled onto Warren’s back before she has enough experience to deal with them. I suspect that happened with Obama. I, of course, will support her. But above all, like you – and you say it so well – “I refuse to be angry, sad, depressed, and I refuse to give up.” Life isn’t worth living if we don’t think anything is worth it. And how many of the biggest victories been fought in relation to what must have felt like hopeless causes? apartheid in South Africa? slavery and racism in the U.S.? women’s rights? anti-Antisemitism? I’ve even got a list of things I fear could lead to our total extinction as a species. At least I can be glad I’m not in charge of the world…

      Have a good year. And thank you. Terry

      On Sun, Jan 11, 2015 at 2:01 AM, The Other I wrote:

      >

      Like

      Comment by Terry Sissons — January 11, 2015 @ 3:55 pm | Reply

  3. Reblogged this on CASTLE OF GLENCAIRN.

    Like

    Comment by lairdglencairn — January 11, 2015 @ 9:14 am | Reply

  4. Gobsmacked. How is that even possible? Our government–once we hand these things over, we never get them back.

    Like

    Comment by grackleandsun — January 13, 2015 @ 12:57 am | Reply

    • Thank you for your comment. “Gobsmacked” is the perfect description. Worse than handing powers over to the government is handing it over to corporations and banks. To make matters worse, Congress has just voted to let corporations donate up to $1million without declaring it to the public. My hope is that we can change the government and gradually get the corporations and banks out of government. We might need a constitutional amendment to reverse the supreme court decision to extend the rights of the citizen to corporations.

      Liked by 1 person

      Comment by theotheri — January 13, 2015 @ 3:18 pm | Reply


RSS feed for comments on this post. TrackBack URI

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Create a free website or blog at WordPress.com.

%d bloggers like this: