The message sent from the banking industry to businesses and consumers has been received. Their need to feed their bonus machine is more important than allowing businesses and consumers to keep their money and be better capitalized to expand the economy. Consumers and businesses that use their debit cards are now going to pay for a bank executive's bonus instead of paying more for expenses or saving.
The idea that banks will not be able to function or make plenty of money without this fee is a lie. The idea that they are doing this because of restrictions on fees they charge businesses totally and completely validates the argument that they are looking out for their own profits before anyone else's. It is another scheme to protect their bonuses and will as has been the pattern of the last 7-8 years be detrimental to the economy as a whole.
I just hope bank executives remember that they took away money from the economy and individuals in order to receive their bonus. Congratulations.
Showing posts with label Citigroup. Show all posts
Showing posts with label Citigroup. Show all posts
Friday, September 30, 2011
Thursday, September 29, 2011
Another revenue gimmick for Banking Industry
In another move to take away money from business and consumers, the banking industry is about to put on a fee for simply using a debit card. The story is from AP via Yahoo!.
This is just another example of how banks are more in business for themselves than in it to grow business. Ridiculous!!!!!
This is just another example of how banks are more in business for themselves than in it to grow business. Ridiculous!!!!!
Sunday, July 18, 2010
bank earnings and your safety
Hey
Earnings for the previous quarter revealed something very interesting and transparent about the big banks and how they continue to make their money. It is primarily through trading and not through banking activities such as lending. Overall, loan losses were down this quarter at the major banks which should provide a boost to their stocks. But the banks' slowdown in trading and other activities had them lowering earnings levels for the quarter.
The New York Times came out with an article stating how banks such as Citigroup and Bank of America took big hits because their trading desks made less money than desired. JP Morgan Chase released good earnings because they released funds meant for possible loan losses. And anyone who thinks Goldman Sachs is a retail bank needs to explain it to me. They are an Investment Bank that had to switch to retail when the crash occured.
As mentioned before, all of these banks were able to pad earnings this quarter with money previously designated for loan losses that didn't occur. This is not a good development. Why didn't they loan the money out instead? This type of action either shows a lack of confidence in the US economy and you as a possible loanee or they are worried about their stock price and put that above helping to drive the needed growth in the U. S. economy. Son't be surprised if it is the latter.
Where are the loans? We gave these firms 700 billion dollars not just to trade and make money for their shareholders but to be a partner in bringing the economy back by making loans to deserving Americans and their businesses that create jobs. The interest received from those loans is a mere pittance for the government and the country as a whole compared to the long term earnings the government would receive in payroll and other taxes had the banks loaned that money out to deserving businesses instead of trading it.
These activities by the mega banks has brought on a movement of going to local banks because people (myself partially included) know they will see their money in work in their communities creating jobs and revenue. This movement needs to continue to grow until the big banks get the message that not loaning money out to deserving businesses is not acceptable. You will hear the banks say their clients are afraid to expand and at the same time hear those same clients complain about a restiction in credit from banks. I believe the businesses, not the banks.
This post is not a desire to eliminate the big banks. They have some great financial products and an important role in the U.S. economy. It is to get them to realize that there is a public needing its partnership to expand our economy.
Earnings for the previous quarter revealed something very interesting and transparent about the big banks and how they continue to make their money. It is primarily through trading and not through banking activities such as lending. Overall, loan losses were down this quarter at the major banks which should provide a boost to their stocks. But the banks' slowdown in trading and other activities had them lowering earnings levels for the quarter.
The New York Times came out with an article stating how banks such as Citigroup and Bank of America took big hits because their trading desks made less money than desired. JP Morgan Chase released good earnings because they released funds meant for possible loan losses. And anyone who thinks Goldman Sachs is a retail bank needs to explain it to me. They are an Investment Bank that had to switch to retail when the crash occured.
As mentioned before, all of these banks were able to pad earnings this quarter with money previously designated for loan losses that didn't occur. This is not a good development. Why didn't they loan the money out instead? This type of action either shows a lack of confidence in the US economy and you as a possible loanee or they are worried about their stock price and put that above helping to drive the needed growth in the U. S. economy. Son't be surprised if it is the latter.
Where are the loans? We gave these firms 700 billion dollars not just to trade and make money for their shareholders but to be a partner in bringing the economy back by making loans to deserving Americans and their businesses that create jobs. The interest received from those loans is a mere pittance for the government and the country as a whole compared to the long term earnings the government would receive in payroll and other taxes had the banks loaned that money out to deserving businesses instead of trading it.
These activities by the mega banks has brought on a movement of going to local banks because people (myself partially included) know they will see their money in work in their communities creating jobs and revenue. This movement needs to continue to grow until the big banks get the message that not loaning money out to deserving businesses is not acceptable. You will hear the banks say their clients are afraid to expand and at the same time hear those same clients complain about a restiction in credit from banks. I believe the businesses, not the banks.
This post is not a desire to eliminate the big banks. They have some great financial products and an important role in the U.S. economy. It is to get them to realize that there is a public needing its partnership to expand our economy.
Monday, December 14, 2009
back to normal
Now that Citigroup has successfully persuaded the government to give its TARP funds back to the government, there must be a sense that all danger in the large banking industry has been eliminated to the largest extent possible. Yeah, right. Citigroup is still losing money! We are right back to 2008.
The main reason for this rush to payment is the executive pay issue. Citigroup wants to get away from the government pay umbrella.
They didn't expand lending. They didn't expand staff to handle the glut of foreclosures.
They did find money for bonuses though.
There will be a lot of pats on the back on this one. But it will mostly be from bankers and politicians that collectively have let us down.
The main reason for this rush to payment is the executive pay issue. Citigroup wants to get away from the government pay umbrella.
They didn't expand lending. They didn't expand staff to handle the glut of foreclosures.
They did find money for bonuses though.
There will be a lot of pats on the back on this one. But it will mostly be from bankers and politicians that collectively have let us down.
Thursday, December 10, 2009
Step on up Citi
So now Citi is trying to pay back the government its remaining 20 billion dollars of US Government TARP aid. They plan to do this by issuing out more stock.
Now, since the government owns one third of the bank's common shares, wouldn't a new issue of shares hurt that investment? The government needs to play hardball on this and not let that sale happen.
This is simply a reactionary plan.Citi is simply jealous that Bank of America was allowed to pay back their debt. But I'm sure the government will roll over. Seems like they are good at that when it comes to the banks.
Now, since the government owns one third of the bank's common shares, wouldn't a new issue of shares hurt that investment? The government needs to play hardball on this and not let that sale happen.
This is simply a reactionary plan.Citi is simply jealous that Bank of America was allowed to pay back their debt. But I'm sure the government will roll over. Seems like they are good at that when it comes to the banks.
Monday, January 12, 2009
bailout for purchasing???
Hey everyone
I just came across a story that is talking about Citigroup dumping its brokerage business to Morgan Stanley for two to three billion. I am loving the way the government has absolutely no control over how the TARP funds are being used. Great job! With the fact that consumers take up 70% of the economy, isn't it great we will barely see any of that money?
This week should be very interesting. Quarterly reports come out, last week of Bush presidency (ie free reign for the banks), and developments on Mr. Madoff.
I just came across a story that is talking about Citigroup dumping its brokerage business to Morgan Stanley for two to three billion. I am loving the way the government has absolutely no control over how the TARP funds are being used. Great job! With the fact that consumers take up 70% of the economy, isn't it great we will barely see any of that money?
This week should be very interesting. Quarterly reports come out, last week of Bush presidency (ie free reign for the banks), and developments on Mr. Madoff.
Tuesday, March 4, 2008
evil empire introduces 401k debit card
Hey everyone
Recently there has been an idea and execution of getting a debit card for your 401K plan. Stay away from that! It is simply another way for the banks to get at your hard earned dollars through fees, fines, and penalties. There is a plethora of articles on the subject with this one from genxfinance as an example.
Speaking of the banks, it has been noted here before how they have been saved by the federal government. I read in the Wall Street Journal today how Citi might be letting go of over 25,000 employees! Can you imagine what the damage might be had the feds not covered their butts?
PBW is trading at the low end of the range.
Recently there has been an idea and execution of getting a debit card for your 401K plan. Stay away from that! It is simply another way for the banks to get at your hard earned dollars through fees, fines, and penalties. There is a plethora of articles on the subject with this one from genxfinance as an example.
Speaking of the banks, it has been noted here before how they have been saved by the federal government. I read in the Wall Street Journal today how Citi might be letting go of over 25,000 employees! Can you imagine what the damage might be had the feds not covered their butts?
PBW is trading at the low end of the range.
Monday, January 28, 2008
Alliance of Banks and Government
Hey everyone
The recent government actions have shown why the banks have a stranglehold on government. I feel that the recent infusion of capital, the allowance of foreign governments to purchase large interests into our banks, and the rebate bill currently proposed will benefit nobody more than the credit card companies and banks. The idea that this money will get to consumers and will get into the economy is wrong because the banks will not release the money either because they are using the money to cover their own losses or they have tightened their credit limits.
When the fed dropped over forty billion into the system and initially dropped rates, they said it was for making the consumer be better able to handle the growing housing and credit issues. In reality, what they did was make it easier for the banks to cover their own losses in the housing and credit issues! Do you really think the CEO's of Citi and Merrill Lynch would get their golden shoots if it were not for the US government? There is a trader in France who is up against charges for losing 7 billion. I know for sure the heads of Citi and Merrill knowingly supervised losses that dwarf 7 billion dollars and still received their retirement! In the meantime, the banks are tightening their lending standards so that they don't make the same mistakes. By doing that, the money train stops at bank station. So the percentage of the billions of dollars that the Federal Reserve released into the banking system actually getting to the consumer is very small.
Speaking of not servicing the American consumer, I would like to bring Congress into the discussion. I am not a little surprised with the fact that the Congress did almost nothing to confront the fact that the banks have sold large portions of themselves to other countries government run financial organizations. The same government that wanted to handle the ports and had to back out has now purchased a large portion of Citibank. There is an article in the Washington Times that quotes Senator Chuck Schumer as saying "this deal will keep New York as a financial center." Now I know they were not given voting rights. But really, do you think they need voting rights to get what they want? They have the oil we need. I don't think they were too concerned with voting rights. With this deal, it is my opinion that the financial center has moved a little closer to asia, not stayed in New York, like Senator Schumer has suggested. Senator Schumer might want to find out how the Morgan family and other bankers were able to wrestle the financial capital away from London and bring it to New York. He and the rest of the Congress might want to find out how those hefty dividends will be used.
The rebate deal passed by the House that is going to give taxpayers like myself a few hundred dollars is almost certainly going to be going to put into credit card bills or house payments. That is all well and good, but the only benefiters of this in the short run are the banks and the credit card companies. I am all for paying those credit cards off. I will be doing the same with my check. I mean people would be stupid to go to Best Buy or Macy's with that money if they have existing debt to pay off.
The fact that the Fed had to drop rates drastically and infuse cash has been a one two punch on the dollar. The value of our currency is in such bad shape, the Canadian dollar is worth more! American manufacturers have seen a bounce because of the low dollar. That is good. But overall, I think there is a long term prospect of having too much money into the system.
So let see. The fed saves the banks by issuing more cash. Foreign government run financial organizations are allowed to buy into our banks, and the rebates will be put towards banks and credit cards. I've heard the tale of the oil companies running this government, but the banks need to be included into the conversation.
Now, with that all said, I do believe that the recent half point rate cut will finally start to put money into the consumers hands. But the simple fact is that it took over 40 billion in cash, two percentage points on fed rates, and a rebate completely designed for the banks to get over the mistakes of the banking industry. I also feel that the banks would probably make a good investment as we now know there business is insured by the US Government.
The recent government actions have shown why the banks have a stranglehold on government. I feel that the recent infusion of capital, the allowance of foreign governments to purchase large interests into our banks, and the rebate bill currently proposed will benefit nobody more than the credit card companies and banks. The idea that this money will get to consumers and will get into the economy is wrong because the banks will not release the money either because they are using the money to cover their own losses or they have tightened their credit limits.
When the fed dropped over forty billion into the system and initially dropped rates, they said it was for making the consumer be better able to handle the growing housing and credit issues. In reality, what they did was make it easier for the banks to cover their own losses in the housing and credit issues! Do you really think the CEO's of Citi and Merrill Lynch would get their golden shoots if it were not for the US government? There is a trader in France who is up against charges for losing 7 billion. I know for sure the heads of Citi and Merrill knowingly supervised losses that dwarf 7 billion dollars and still received their retirement! In the meantime, the banks are tightening their lending standards so that they don't make the same mistakes. By doing that, the money train stops at bank station. So the percentage of the billions of dollars that the Federal Reserve released into the banking system actually getting to the consumer is very small.
Speaking of not servicing the American consumer, I would like to bring Congress into the discussion. I am not a little surprised with the fact that the Congress did almost nothing to confront the fact that the banks have sold large portions of themselves to other countries government run financial organizations. The same government that wanted to handle the ports and had to back out has now purchased a large portion of Citibank. There is an article in the Washington Times that quotes Senator Chuck Schumer as saying "this deal will keep New York as a financial center." Now I know they were not given voting rights. But really, do you think they need voting rights to get what they want? They have the oil we need. I don't think they were too concerned with voting rights. With this deal, it is my opinion that the financial center has moved a little closer to asia, not stayed in New York, like Senator Schumer has suggested. Senator Schumer might want to find out how the Morgan family and other bankers were able to wrestle the financial capital away from London and bring it to New York. He and the rest of the Congress might want to find out how those hefty dividends will be used.
The rebate deal passed by the House that is going to give taxpayers like myself a few hundred dollars is almost certainly going to be going to put into credit card bills or house payments. That is all well and good, but the only benefiters of this in the short run are the banks and the credit card companies. I am all for paying those credit cards off. I will be doing the same with my check. I mean people would be stupid to go to Best Buy or Macy's with that money if they have existing debt to pay off.
The fact that the Fed had to drop rates drastically and infuse cash has been a one two punch on the dollar. The value of our currency is in such bad shape, the Canadian dollar is worth more! American manufacturers have seen a bounce because of the low dollar. That is good. But overall, I think there is a long term prospect of having too much money into the system.
So let see. The fed saves the banks by issuing more cash. Foreign government run financial organizations are allowed to buy into our banks, and the rebates will be put towards banks and credit cards. I've heard the tale of the oil companies running this government, but the banks need to be included into the conversation.
Now, with that all said, I do believe that the recent half point rate cut will finally start to put money into the consumers hands. But the simple fact is that it took over 40 billion in cash, two percentage points on fed rates, and a rebate completely designed for the banks to get over the mistakes of the banking industry. I also feel that the banks would probably make a good investment as we now know there business is insured by the US Government.
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