This seems like a simple, effective means of speaking with our wallets.
Take Your Money Out of the Hands of the Banking Oligarchs
QuoteLast week, over a pre-Christmas dinner, the two of us, along with political strategist Alexis McGill, filmmaker/author Eugene Jarecki, and Nick Penniman of the HuffPost Investigative Fund, began talking about the huge, growing chasm between the fortunes of Wall Street banks and Main Street banks, andstarted discussing what concrete steps individuals could take to help create a better financial system. Before long, the conversation turned practical, and with some help from friends in the world of bank analysis, a video and website were produced devoted to a simple idea: Move Your Money.
The big banks on Wall Street, propped up by taxpayer money and government guarantees, have had a record year, making record profits while returning to the highly leveraged activities that brought our economy to the brink of disaster. In a slap in the face to taxpayers, they have also cut back on the money they are lending, even though the need to get credit flowing again was one of the main points used in selling the public the bank bailout. But since April, the Big Four banks -- JP Morgan/Chase, Citibank, Bank of America, and Wells Fargo -- all of which took billions in taxpayer money, have cut lending to businesses by $100 billion.
Meanwhile, 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. Many of them have closed down (or been taken over by the FDIC) over the last 12 months. The government policy of protecting the Too Big and Politically Connected to Fail is badly hurting the small banks, which are having a much harder time competing in the financial marketplace. As a result, a system which was already dangerously concentrated at the top has only become more so.
We talked about the outrage of big, bailed-out banks turning around and spending millions of dollars on lobbying to gut or kill financial reform -- including "too big to fail" legislation and regulation of the derivatives that played such a huge part in the meltdown. And as we contrasted that with the efforts of local banks to show that you can both be profitable and have a positive impact on the community, an idea took hold: why don't we take our money out of these big banks and put them into community banks? And what, we asked ourselves, would happen if lots of people around America decided to do the same thing? Our money has been used to make the system worse -- what if we used it to make the system better?
Everyone around the table quickly got excited (granted we are an excitable group), and began tossing out suggestions for how to get this idea circulating.
Eugene, the filmmaker among us, remarked that the contrast between the big banks and the community banks we were talking about was very much like the story in the classic Frank Capra film It's a Wonderful Life, where community banker George Bailey helps the people of Bedford Falls escape the grip of the rapacious and predatory banker Mr. Potter.
It was a lightbulb moment. And, unlike the vast majority of dinner conversations, the excitement over this idea didn't end with dessert. It actually led to something -- thanks in great part to Eugene and his remarkable team, who got to work and, in record time, created a brilliant, powerful, and inspiring video playing off the It's a Wonderful Life concept. (Watch it in the video player on the top right hand side of the screen).
Within a few days, the rest of the pieces fell into place, including an agreement with top financial analysts Chris Whalen and Dennis Santiago, who gave us access to their IRA (Institutional Risk Analytics) database. Using this tool, everyone will be able to plug in their zip code and quickly get a list of the small, solvent Main Street banks operating in their community.
The idea is simple: If enough people who have money in one of the big four banks move it into smaller, more local, more traditional community banks, then collectively we, the people, will have taken a big step toward re-rigging the financial system so it becomes again the productive, stable engine for growth it's meant to be. It's neither Left nor Right -- it's populism at its best. Consider it a withdrawal tax on the big banks for the negative service they provide by consistently ignoring the public interest. It's time for Americans to move their money out of these reckless behemoths. And you don't have to worry, there is zero risk: deposit insurance is just as good at small banks -- and unlike the big banks they don't provide the toxic dividend of derivatives trading in a heads-they-win, tails-we-lose fashion.
Think of the message it will send to Wall Street -- and to the White House. That we have had enough of the high-flying, no-limits-casino banking culture that continues to dominate Wall Street and Capitol Hill. That we won't wait on Washington to act, because we know that Washington has, in fact, been a part of the problem from the start. We simply can't count on Congress to fix things. We have to do it ourselves -- and the big banks are the core of the problem. We need to return to the stable, reliable, people-oriented approach of America's community banks. ...
Find a Bank
Not all community banks are risk free. Some of them got involved in the same risky behavior that took down some of the biggest banks. Thanks to the volunteer services of a group called Institutional Risk Analytics (IRA), you can get a listing of the most sound community banks near you. IRA lists only banks that, according to its rating system, which is based on government data, get a grade of "B" or better.
Credit Unions: Many folks have written us suggesting that people should examine credit unions. Like the FDIC for banks and thrifts, the National Credit Union Administration insures the deposits of credit unions and is a good resource for financial data on specific institutions. Credit unions do not disclose financial data in the same way as FDIC-insured banks. As a result, credit unions are not presently included in the IRA ratings database, which covers over 8,000 federally insured banks and thrifts. IRA is developing a method to rate credit unions in a way that is comparable to the IRA bank stress ratings. We'll be updating users of "Move Your Money" on this issue early in 2010.
http://www.alternet.org/action/144882/take_your_money_out_of_the_hands_of_the_banking_oligarchs/?page=1
Interesting idea. It's hard to say just how this would play out, but at this point I'm inclined to think anything that shows the political class and their patrons how angry we are here in proletariatville is a plus.
What would happen if the idea really caught on and there was a run on the big banks? Bank holiday? More concessions from the Washington Weasels? I'd love to see the stink that would raise!
I think a slow moving-away from the big banks would be the best scenario; They wouldn't have the threat of sudden collapse to threaten us with.
I'd rather see a simmering anger than the apathy I see in my family/friends.
I'd rather see a simmering anger than the apathy I see in my family/friends.[/font]
You hit the nail on the head. Apathy is 99% of the problem.
Posted on: Today at 08:04:55 AM
Posted by: harry51
Starve the beast! >:(
Quote from: waggin on December 31, 2009, 01:28:01 PM
Starve the beast! >:(
Pretty hard to starve the beast when we as a people insist on being in debt. By being in debt you simply feed the beast.
Interesting little factoid: The latest statistics from the Federal Reserve indicate that the total amount of consumer debt outstanding remained fairly steady in 2009. In case you're wondering the total amount of consumer debt in the United States stands at nearly $2.5 trillion dollars - and based on the latest Census statistics, that works out to be nearly $8,100 in debt for every man, woman and child that lives here in the US.
Simple math: a family of four equals $32,400. Is it the banks fault or is it our fault? We as a nation refuse to save. We want it now, we throw something in the microwave and yell at it as it cooks "What the HELL IS TAKING SO LONG." We are not unlike Esau in the Old Testament willing to sell our whole inheritance for a little lentil stew because we are wanting. We are seemingly willing to pay upward of 25% or more of our earnings in interest charges for consumer debt. For a promise of instant satisfaction only to find out it is not in a new computer, car, gun, clothes or fourwheeler, so where is it? I must continue the hunt, I shall find it...... I am promised by slick advertisements paid for by VISA which is owned by the banks... it is there ... some where.
The "starve the beast" sentiment is all-encompassing. I used to have a roomate who would buy/finance luxuries on his credit card. I told him he was paying 10% (back in the 1990's) more for everything than what I was paying.
Is it our legislators who set the example of irresponsibility, or is it we who elect (I use the term loosely.) representatives (ditto) in our own image? Makes for a nice chicken or the egg debate.
Population:
308,269,396
National Debt per person:
http://www.usdebtclock.org/ (scary, but worth looking at!)
$12,132,139,000,000 as of 12/31/09 @1:22pm PST
Debt per citizen: $39,355
Debt per taxpayer: $111,306
The few that have the ability and the even fewer that have the will to take action collectively amount to the power of a fart in a windstorm, but it's still a statement. A statement worth making.
Quote from: waggin on December 31, 2009, 04:54:53 PM
Is it our legislators who set the example of irresponsibility, or is it we who elect (I use the term loosely.) representatives (ditto) in our own image? Makes for a nice chicken or the egg debate.
I certainly can not agree more. I have always felt this is key in this issue. In fact I have been told that point blank. 'Why should I? The government doesn't. They always come out of it. I guess I will as well!'
Quote from: waggin on December 31, 2009, 04:54:53 PM
The few that have the ability and the even fewer that have the will to take action collectively amount to the power of a fart in a windstorm, but it's still a statement. A statement worth making.
People do not understand you can live in the USA without a FICA score. You can do business here as well. I do agree it is a statement worth making and a lot of people now days are starting to wake up. I know we have!
This will sound stupid, but what is a FICA score?
It's actually FICO (Fair Isaac Company). It is your credit score.
While we're on the subject everyone is entitled to a free credit report once each year from each of the big three agencies.
Go to https://www.annualcreditreport.com/cra/index.jsp There are many sites that offer "free" reports but that is the only site authorized under the federal law.
Also see: http://www.ftc.gov/freereports
FICA is the social security tax; deducted by your employer and matched by the employer and submitted by the employer.
I do apologize it is FICO. I think I was thinking the year ending and my taxes and :( I sort of went down the wrong road.
lol no worries. I was curious because I know what FICA was, which is why I was all confused about a FICA score. I know my credit is good because the two times I've asked for a loan, each time they praise me up and down about it. However I don't use credit. I used it to buy my car, but I paid that off 2 years early and I used it to help finance some of the engagement ring I bought my fiancee, which I will have paid off in 4 months. Otherwise my single credit card goes to buying gas and gorceries, and that gets paid off, in full, every month.
But back on topic, I have considered taking my money out of my current bank and putting it into the local one here in my county. However I don't have a lotta money in the bank to begin with.
I'm doing my part- when the feces hit the ventilator, and all of the big banks were looking shaky, I took most of my money out of BoA. It's in a small local bank now. They looked really shocked when I withdrew it, but the teller leaned over and whispered, "I don't blame you." I have one credit card with a big bank, but it gets paid to zero every month- they make nothing off of me at all.
Quote from: MushCreek on January 01, 2010, 09:40:13 AM
I have one credit card with a big bank, but it gets paid to zero every month- they make nothing off of me at all.
There are hidden fees though. The bank charges the merchant who accepted the credit card as payment. That fee varies widely; could be anywhere from <2 to >6%. Some gas stations offer 3 to 5 cents a gallon discount for cash instead of credit, and that's the reason they do.
That's why on large purchases I ask if I can get a discount for cash. Some do, most don't.
Good point MD. My wife and I were doing a little retail on the side a couple years ago. We quickly found the bonus travel / merchandise points like two percent bonus points for a buyer using their card came from the merchants sales plus fees. So you in turn needed adjust this in your price points to cover the buyers bonus points.
As in real life there is no free lunch and there are no free bonus points. Chase is never going to say here take a trip on us. No, sorry you bought them with interest. It would be a lot cheaper for all of us if they discontinued this practice, and we all bought our tickets straight out over the counter. Also talk about a bonus for the banks. How many of those bonus point never get used? I do know they are never rebated back to the merchant if not used. The buyer can not use them outside of the contract. Talk about a rip off to the consumer and the merchant and a bonus to the banks.
I went to the website and put my zip into the tool to locate a community bank, but it wouldn't work. Did anyone find out how to get the info?
http://moveyourmoney.info/
Note that this seems to miss some of the local banks near me. Don't forget the credit union option as well. Lots of them are open to just about anyone.
I'd move my money, but it's already in a local credit union. I did close my ING account. The potential for a virtual bank run was just too scary.
Here is a fun factiod for you guys. Since my wife and I switched from credit cards to cash, we have saved an average of $400 a month. And that figure includes the holidays since we started in October. Not sure how it works, but it does. Probably something about physically parting with the cash.
I'll be opening my credit union account soon- with my student loan from Wells Fargo.
I'm going to hang-on to my student loan money just in case I need it; If not, I'll pay it back after graduation minus the accrued interest.
I have been watching this thread but do not have much to add other than to say I think the idea is fantastic and the only morally just approach to take. I did this already some time ago so I dont have any more juice to give the initiative, I already did it. so should you if you have not. especially the big 6, jp morgan, bank of america, wachova, chase, wells fargo, city. starve the beast.
We had our money in a local bank & it went belly up... bought out by a bigger, national bank d*
The problem is many of the big banks make a ton of money charging huge fees for credit cards, not to mention they buy up mortgages issued by smaller banks. These banks don't give a crap about most working people, they cater to the super wealthy, just as our government caters to them. Pay off your debts and then use cash only. If you honestly want to take away their power then live debt free. Yeah, I know, easy to say, a tad difficult to practice.
This is a good WSJ article about what we can expect from banks and credit card companies.
http://online.wsj.com/article/SB10001424052748704162104574630360393559766.html?mod=rss_Today's_Most_Popular
Sassy, sorry to hear about your local bank. I suggest a local credit union. You can also research the overall financial health of the credit union by one of several rating services (don't know links offhand). I also suggest sitting down and talking with them about their modus operandi. I think you will be pleased with the level of customer service in general. Remember that credit unions are nonproft, they don't answer to sharholders or executives. They are generally run by a board of elected members. And to top it off banks hate credit unions.
I think one ends up doing their best to balance finances in general. For me, I do not have any debt except the ongoing usuals, but I cannot afford to take the tax hit of removing my investments from the IRA...its too soon, I'm too young (probably the only category in which this is true). I use a local bank, except for one instance in which I cannot.....whatever works for each individual is what ends up happening.
I had a more simplistic view of how the bailout should have occured....all that money, spread amongst the sheeple would have been spent to pay off mortgages, credit cards, and generally support the businesses that "deserved" to survive. The others would have gone by the wayside....and proven which deserved to survive and which did not.
I don't even have a credit score, I checked. Its been too long since I purchased anything on credit, and the firms that bill me on an ongoing basis are too small to report to the credit scoring companies. That's the grid I'm glad to be off of.
Quote from: Mike 870 on January 05, 2010, 03:43:51 PM
I'd move my money, but it's already in a local credit union. I did close my ING account. The potential for a virtual bank run was just too scary.
How many depositors have lost their money in a bank run since 1933?
I'm guessing the answer is zero?
That's my understanding. So why are you afraid of a bank run?
I said I was afraid of a virtual bank run. An ING account is like a virtual add on to a checking account. You move your money in and out via computer. You used to get like 4 % interest on your money while it was in there without restrictions. It's so easy to move money in and out that a big panic could cause everyone to try to move their money out at the same time, via click of a button. I can just imagine a computer message, we're sorry all account activity is suspended at this time. Please try again later.
Here's a pretty good article on the subject.
http://www.lewrockwell.com/north/north527.html
Quote from: Pox Eclipse on January 07, 2010, 12:10:26 AM
How many depositors have lost their money in a bank run since 1933?
Quote from: Mike 870 on January 07, 2010, 09:44:16 AM
I'm guessing the answer is zero?
I'm breaking my self imposed rule about posting while intoxicated. But this is not true. The correct working is "How many depositors have lost their money in a bank runs for insured amounts since the inception of the fdic in 1933?" For that, the answer is zero.
How many people have lost funds in the past year due to bank failure, the answer is in the thousands. Until Fall of 2008, the fdic insured amount was 100k, and then it was raised to 250k. If a bank account had more than that upon seizure it was lost. I know of two business's personally that have been affected by that as their payroll was larger than 100k and they HAD to keep more in the account to meet check obligations.
Not someone I know personally, but someone I read about and research checked as legit sold a house on a Thursday, got a settlement check on Friday for 300k+ and fdic closed the bank. They were only insured to 250k and lost a hell of a chunk.
As for accounts under the limit, no one ever to my knowledge has lost a penny.
But thats not what this is about (to me at least). It is about how a bank operates in my opinion. For every dollar they have in deposits, they are allowed to lend 90% out. As we all know, they are not lending this money out but keeping it on reserve at the fed and gaining a few percentage points there. This means that when you put your paycheck in one of those pig banks, they get to gain interest on 90% of it for doing nothing. For their trouble, they will charge you 29.99% interest on money they borrow at zero%. They will hit you with every overcharge they can think up, and they will snidely and snottily give themselves bonuses for their innovative "money creation" thinking. They know they are too big to fail, to big to be regulated, to big to be prosecuted, to big to follow laws, and to big to be questioned. I say it is morally reprehensible and repulsive to give those pigs a dime.
Not only does increasing their deposit base give them that "too big to fail status" it also gives them the capital to play games like buying oil on the ice intercontinental exchange and keeping it in tankers to drive the cost up - which only hurts america and our economy more. These are people without a country, or a sense of right and wrong. They manipulate and steal and defraud without consequence or care.
I simply cannot verbalize how much I hate these big banks with every fiber of my being. No decent person should have a penny deposited with any of them.
What he said.
I have no love for the banks, but from a safety perspective, what is your alternative? As far as I know , no other institution can offer any guarantee at all, so that makes the FDIC's $250,000 look pretty good.
The National Credit Union Administration (NCUA) insures funds in credit unions up to $250,000 as well, thats one way you can go. FYI I don't work for a credit union, I'm only a happy member.
Quote from: Pox Eclipse on January 08, 2010, 08:24:26 AM
I have no love for the banks, but from a safety perspective, what is your alternative? As far as I know , no other institution can offer any guarantee at all, so that makes the FDIC's $250,000 look pretty good.
There are over 7500 banks in this country, only 150 or so took TARP funds, and only 8 or so of them are considered too big to fail. Are you honestly saying that you cannot find an alternative to the too big to fail banks?
No that's not what I am saying. Mike didn't limit his criticism of banks to those that were deemed "too big to fail". He was talking about all banks, large and small. And I largely agree with him about how the banks have shat on the American economy for their own enrichment.
I think credit unions are probably the best alternative, but they are no more immune to runs than any other institution, so if you are a business with a million dollar payroll, you are still going to have to split up your accounts to guard against runs.
I found this list of failed banks on the FDIC website (http://www.fdic.gov/bank/individual/failed/banklist.html), 140 of them in the last year. Here is a similar list of failed credit unions on the NCUA website (http://www.ncua.gov/Resources/ClosedCU/2009.aspx). They are all small community institutions that were either taken over by large banks and credit unions, or they were liquidated and depositors were reimbursed by the FDIC or NCUA, up to the limited provided by law. It seems to me that, from strictly a risk standpoint, for the foreseeable future, unless you have inside knowledge of their viability, small community banks and credit unions are the last place you should be putting your money.