MemberSince99

A place to discuss anything... except credit cards!
34 posts
popamode72
Centurion Member
Centurion Member
 
Posts: 1099
Joined: Sun May 04, 2014 4:41 pm
Location: Atlanta, GA

Postby popamode72 » Thu Nov 27, 2014 8:34 pm

MB131174 wrote:seinfeld for sure


Good. Let's keep it that way. Lol.
Macy's TLs (21k), Lowes (17k), CSP (10k), Sam's Club (10k), Nordstrom (5k), AARP (4.2k), Freedom (3k), Discover (1.5k), Quicksilver (2k), BoA (3k), Barclaycard Arrival (2.5k), Amazon Store (6k), Paypal (4.9k), Sam's Club MC (3.6k), Walmart MC (1.2k)


User avatar
CarefulBuilder14
Centurion Member
Centurion Member
 
Posts: 3743
Joined: Thu May 08, 2014 7:42 pm
Location: United States

Postby CarefulBuilder14 » Thu Nov 27, 2014 10:09 pm

whit,

It sounds like you are saying that larger banks were inherently more conservatively capitalized or had better management than small banks going into the financial crisis. It sounds like you're saying that these banks are inherently superior, and somehow evolved to survive a Darwinian free market.

The big banks survived, for the most part, not because they were better-run but because they were considered by regulators to be too big to fail - it was critical for the health of the financial system that they stay in business because so many people were dependent on them. When Lehman failed and regulators didn't intervene, there was chaos in the market.

The big banks were not healthier going into the downturn. Often they were the sickest 'patients' in the eyes of regulators. It was simply that due to their size and the consequences of their potential failure, they got priority for financial 'life support' from the Fed and Treasury Dept. Small banks that failed didn't get that kind of help, because they could fail while the rest of the system carried on.

I am not totally averse to the existence of big banks - they do have a purpose. For long-term prosperity, though, we also need small banks to be strong. Small banks lend to startups and small businesses that big banks ignore.

I do believe that large, systemically important banks should be held to especially strict regulations. Any institution backed by taxpayers through the FDIC should have strict capital requirements and accounting standards, but especially one whose failure is capable of disrupting the entire capital market.

I support the Volcker Rule. And given how the banks have backed both Democrats and Republicans to weaken Dodd-Frank into a joke, I'd say very little has changed in how big banks are run.

In general, Wall Street and banking culture doesn't change in any meaningful way. It just appears to change as is fashionable for profits and to draw customers.

Edit: I found a good speech by Niall Ferguson about how financial 'evolution' has been reversed by regulators by favoring large, inefficient institutions. He describes it well:

"As long as the dinosaurs are on life support, there's really no incentive to create new firms, or even to restructure the old ones properly."

http://www.hulu.com/watch/109529 Minute 47

And any bank that is too big to fail knows that the life support is always available.
Wallet: Prestige CSP SchwabPlat Freedom It Hyatt SallieMae AAPlat
SD: Arrival BrooksBros BCE ED IHG
Letting new accounts cool off since May
Really not sure what I'll add next or when

User avatar
otter
Centurion Member
Centurion Member
 
Posts: 639
Joined: Sat Aug 24, 2013 8:45 pm
Location: Grand Forks, ND

Postby otter » Fri Nov 28, 2014 4:39 pm

djrez4 wrote:The big banks came out bigger, stronger, richer, and with a heavier stranglehold on the American economy after the crisis. Why wouldn't they want another one?


whit wrote:Errrr not really

They had to regroup, there's an emphasis on investment because how else can they recoup fees lost? Why do you think debit card cash back went away?

You need to understand only the big ones could take that kind of hit AND they paid big..hell, I stocked up on bofa stock because it hit almost towards the penny stock category (I ain't no trump) butttttttttttttt I knew they would bounce back because

Big banks can take the hit but they won't go away, not really..who else can finance some of the bigger corporations out there? Bofa has been around so long and have grown themselves big enough that they can handle the corporate accounts and if they went away. Who would take up the slack?

If Jpmorgan went away, who would have brought the bear on wall st, the wamu, whose practices (mind you chase didn't own it then) were so bad that they went under..and than the government married the bunch in a shotgun marriage and daddy went back and claimed $$ and set an example a few years later.

Long stories really but I think it's funny people think big banks left unscathed.. they took a shot to the knees and have rehabilitated but they're not the same.


If the big banks took a shot to the knees, I would argue that it was mostly self-inflicted. Rez is correct in every way. They are stronger because they don't have as many small "nuisance" banks to compete with and the scary part is that they know the government will bail them out when they f--k up in the future. And their stock prices may not have recovered entirely, but they are richer than they ever have been.

If the government really wanted to bail out the big banks(something which I wasn't in favor of), this is that they should have done (using BoA as an example):

So you want money to avoid going belly up? This is how we are going to do it... You are no longer Bank of America, you are NCNB like you were 30 years ago. Those banks you bought on the west coast are going to be spun off as Bank of America like they were before you bought them (and the name). The banks in the deep south which were C & S Sovran are once again C & S banks. The one time Barnett Bank of Florida is once again Barnett Bank, and so on for the dozens of banks you've bought over the years. You will never again be "too big to fail".

And ditto the same message to GM... they should have made them spin off Cadillac, Pontiac (which could have been viable on its own), Buick, etc and you are now simply Chevrolet, Inc.
In my Wallet:
  • Amex PRG NPSL[3-14, bd 91]
  • Sallie Mae MC $8000[1-14]
  • Chase Freedom $4700[1-14]
  • Discover It $2750[8-13]
  • BoA UCF Alumni Cash Rewards $5000 [3-15]
Sometimes in my Wallet:
  • GM BuyPower WEMC $5000[9-14]
  • Wells Fargo Propel 365 Amex $7000[4-14]
  • Barclaycard Arrival WEMC $7000[3-14]
  • BoA Better Balance $3000[2-15]
In my sockdrawer: Amex BCE $1000[10-13, bd 91], OCCU Duck $10000 [11-13], The Sportsman's Guide Visa $8000[8-14], Chase Slate $4000 [9-14]Delta Gold Amex $2000 [2-15 bd 91], Diners Club MC $20000 [10-14] Commerce Bank Visa $2000 [3-15] Citi Double Cash $1000 [3-15]
Total CL: $90450

popamode72
Centurion Member
Centurion Member
 
Posts: 1099
Joined: Sun May 04, 2014 4:41 pm
Location: Atlanta, GA

Postby popamode72 » Fri Nov 28, 2014 5:00 pm

I've always been fascinated by the Sweden's nationalization approach to how they handled their banking crisis but I like hearing alternative viewpoints on this subject too.
Macy's TLs (21k), Lowes (17k), CSP (10k), Sam's Club (10k), Nordstrom (5k), AARP (4.2k), Freedom (3k), Discover (1.5k), Quicksilver (2k), BoA (3k), Barclaycard Arrival (2.5k), Amazon Store (6k), Paypal (4.9k), Sam's Club MC (3.6k), Walmart MC (1.2k)

whit
Centurion Member
Centurion Member
 
Posts: 508
Joined: Tue Aug 13, 2013 10:04 pm
Location: ca

Postby whit » Fri Nov 28, 2014 9:31 pm

I'm not sure if you remember me talking about the government being the one to initial the shotgun wedding of wamu with chase

Chase wanted to buy wamu but wamu, being a somewhat big bank but not the big four, resisted

than when push came shove chase had to step in, same with bears

and it didn't matter that Chase wasn't in charge when certain shady practices were done when it was done

but when the regulators went after the bank, who was responsible, was the current owner as there is no bears or wamu to go after

but chase, because they "brought" it even if they has no control over what happened during that time because it wasn't under their ownership..but hey, they benefited from it (which is why they're "bigger and stronger" because they ate up more of the pie of business and holdings) but I'm pretty sure if they knew that they would be sought after for that and have to pay millions/billions (on top of their own ****) they might not agree to buy it out per gov request

does this mean chase is perfect? no

does it mean that other banks didn't have actions that are questionable?

no

but I think it's interesting that you guys are presenting like the big banks are all bad and no good,

I don't mean that because banks are so big they "can't fail" the irony being that if they could take the "bailouts" wouldn't the smaller banks have done the same? why force bears on chase at 2 bucks, later upgraded to more so shareholders won't be so so angry just so angry..why not just bail out bears?

User avatar
otter
Centurion Member
Centurion Member
 
Posts: 639
Joined: Sat Aug 24, 2013 8:45 pm
Location: Grand Forks, ND

Postby otter » Mon Dec 01, 2014 5:26 am

whit wrote:but I think it's interesting that you guys are presenting like the big banks are all bad and no good,


Hey, it's not just "us":
http://banking.about.com/od/bankaccountreview1/a/big-four-banks-consumerist-worst-companies.htm

If the big banks got big by wowing people with great customer service, then I would say more power to them...

But they all consistently rank at or near the top for poor customer service.
In my Wallet:
  • Amex PRG NPSL[3-14, bd 91]
  • Sallie Mae MC $8000[1-14]
  • Chase Freedom $4700[1-14]
  • Discover It $2750[8-13]
  • BoA UCF Alumni Cash Rewards $5000 [3-15]
Sometimes in my Wallet:
  • GM BuyPower WEMC $5000[9-14]
  • Wells Fargo Propel 365 Amex $7000[4-14]
  • Barclaycard Arrival WEMC $7000[3-14]
  • BoA Better Balance $3000[2-15]
In my sockdrawer: Amex BCE $1000[10-13, bd 91], OCCU Duck $10000 [11-13], The Sportsman's Guide Visa $8000[8-14], Chase Slate $4000 [9-14]Delta Gold Amex $2000 [2-15 bd 91], Diners Club MC $20000 [10-14] Commerce Bank Visa $2000 [3-15] Citi Double Cash $1000 [3-15]
Total CL: $90450

whit
Centurion Member
Centurion Member
 
Posts: 508
Joined: Tue Aug 13, 2013 10:04 pm
Location: ca

Postby whit » Mon Dec 01, 2014 9:15 pm


User avatar
CarefulBuilder14
Centurion Member
Centurion Member
 
Posts: 3743
Joined: Thu May 08, 2014 7:42 pm
Location: United States

Postby CarefulBuilder14 » Mon Dec 01, 2014 9:27 pm

Bank of America is at or near the bottom of the list for most regions (with the worst customer ratings), and it survived and it absorbed Countrywide and ML. It's as big as it ever was.

If good management and customer service (rather than sheer size and systemic importance, as I and others contend) were criteria for survival, then why is BofA still around?
Wallet: Prestige CSP SchwabPlat Freedom It Hyatt SallieMae AAPlat
SD: Arrival BrooksBros BCE ED IHG
Letting new accounts cool off since May
Really not sure what I'll add next or when

whit
Centurion Member
Centurion Member
 
Posts: 508
Joined: Tue Aug 13, 2013 10:04 pm
Location: ca

Postby whit » Mon Dec 01, 2014 9:40 pm

Chase is top in Florida, which is amazing, and is one of the big four

As I've said before, I'm not sure where I said good management and customer service directly (although I would say that chase is one of those who was forced to eat up wamu because it fell under, like bears, and than be brought to prosecution for activities done under wamu/bears control..but because they "benefit" from the holdings, acquiring of, they also had to "pay" for mistakes made, not theirs)

If that's where you all are getting it from, just to clarify,

I also said some cannot go down like bofa, ironically, which is why I myself, invested in their stock, because they've grown to a size where they can manage retail chains big as the mall brands you see, because not only of their footprint (how else does a business deposit cash and get change order?) but also because of the type of services they offer

Some small banks, and credit union, isn't big enough to handle certain merchant services and the businesses that are middle size..not huge like..gap, h&m, etc..even those middle sized business, finds that the system and services offered by the smaller bank, cannot compete

So Bank of America, even though they didn't have it all in order, and still have a lot of kinks to work out, can survive because of that

Again, not saying big banks are perfect..and I do feel sorry for bofa, they wasted a lot of money on internal nonsense instead of, upgrading their system like other companies *cough*chase*cough* so it's very dinosaur, and it's an expensive overhaul..I could go on and on but don't really want to confuse you, I'm not fully for or against

However, I felt the need to balance the things a bit..I never said big banks are great, or that they're 100% right, but I think a lot of people don't think thoroughly and things are never as easy as 1-2-3 (despite Brian M. Plan)

whit
Centurion Member
Centurion Member
 
Posts: 508
Joined: Tue Aug 13, 2013 10:04 pm
Location: ca

Postby whit » Mon Dec 01, 2014 9:50 pm

Ps, countrywide was soooo bad in terms of the mortgage I don't know if they were force to take it or stupidly did so without having a complete audit of its books or wasn't able to or what..

I know a few people who managed to get out of countrywide that told me stories I can't believe..really like the Wild Wild west



Return to “The Lounge”

Who is online

Users browsing this forum: No registered users and 0 guests