Are the bankers killing America?

[ralfy]

Most of money supply is created by private financial institutions:

"The myth of the money multiplier"

http://www.businessspectator.com.au/article/2012/10/22/commodities/myth-money-multiplier

and part of a global economy dominated by the same:

"Revealed – the capitalist network that runs the world"

http://www.newscientist.com/article...e-capitalist-network-that-runs-the-world.html

The goal is profit through financing and through capitalization of production and consumption driven by a growing global middle class:

"The rise of the global middle class"

http://www.bbc.co.uk/news/business-22956470

and all part of a global economy that is not sustainable because of peak oil and global warming.

 

[norseamd]

*Thomas Jefferson knew that having a centralized bank was wrong and that it would destroy America.

my opinion is that a full federal bank that individuals can loan from or open bank accounts with would be far better than a private bank that wants to make money off people. same with supply of energy

 

[norseamd]

capitalization of production and consumption driven by a growing global middle class:

this is what i am worried about. several hundred years ago people lived without money on the frontier. today you could grow a lot of your own food in your house in a greenhouse maybe even on the roof and only pay for seed and water. things like fusion power and the desalization plants that would be possible with power would dramatically reduce the cost of electricity and water.

 

[Darwin333]

LOL - you are wrong on every single bullet point....

- Banks don't make money on bad loans if interest rates are low. When I mean "low", I mean any rate lower than 25-30% on a longer term collateralized loan (autos) and 50%+ on an unsecured short-term loan. Most credit cards don't "make" money if they default within a year or two. Banks lending at 6% on a 5-year auto loan with a 110% LTV won't "make" money on that loan since a used vehicle may only recover 70%, at best.

- The objective is to lend money to the people who want it for current consumption.

- Pray tell how many banks the Fed is currently lending money to. I would really love to know.

- The Fed issues and controls the money pursuant to Congressional mandate. The interest paid to the Fed is rebated, after costs and small dividends to the Fed member banks, back to the US Treasury. In fact, the vast majority of interest paid to the Fed is rebated. In this you are laughably wrong.

- Banks don't put people into debt for life, people put themselves into debt for life.

I have read numerous reports (I'll look for a few in a bit) that show the banking sector is extracting an ever greater percentage of GDP then it historically has.

What is your take on that? Obviously the higher the percent they take the less we have to spend on other things. Are they providing additional services that are relatively "hidden" from most of us?

 

[LegendKiller]

I have read numerous reports (I'll look for a few in a bit) that show the banking sector is extracting an ever greater percentage of GDP then it historically has.

What is your take on that? Obviously the higher the percent they take the less we have to spend on other things. Are they providing additional services that are relatively "hidden" from most of us?

I think some of that was always there, they just couldn't measure it since it was a lot less aggregated and many smaller banks and finance companies weren't public, thus, couldn't be aggregated and measured well. I think some of it is that we are overbanked and overborrowed, but that should come back into equilibrium eventually.

 

[Doppel]

http://www.nytimes.com/2014/01/19/opinion/sunday/for-the-love-of-money.html

 

[Jhhnn]

I think some of that was always there, they just couldn't measure it since it was a lot less aggregated and many smaller banks and finance companies weren't public, thus, couldn't be aggregated and measured well. I think some of it is that we are overbanked and overborrowed, but that should come back into equilibrium eventually.

I think you're right. That's what bubbles do- they create over borrowing. At least that's what happened with the housing bubble. The economic drag of that debt overhang should not be discounted by anybody. It means that lots of people are financially buried under their mortgages, and will be for many years. They're house-poor. Only rising wages, lots of time to overcome negative equity, or default will give them any relief.

Reference Irving Fisher.

 

[piasabird]

So live without loans. Not that hard. It is called saving money.

 

[Oldgamer]

LOL - you are wrong on every single bullet point....

- Banks don't make money on bad loans if interest rates are low. When I mean "low", I mean any rate lower than 25-30% on a longer term collateralized loan (autos) and 50%+ on an unsecured short-term loan. Most credit cards don't "make" money if they default within a year or two. Banks lending at 6% on a 5-year auto loan with a 110% LTV won't "make" money on that loan since a used vehicle may only recover 70%, at best.

- The objective is to lend money to the people who want it for current consumption.

- Pray tell how many banks the Fed is currently lending money to. I would really love to know.

- The Fed issues and controls the money pursuant to Congressional mandate. The interest paid to the Fed is rebated, after costs and small dividends to the Fed member banks, back to the US Treasury. In fact, the vast majority of interest paid to the Fed is rebated. In this you are laughably wrong.

- Banks don't put people into debt for life, people put themselves into debt for life.

You are wrong on that, banks do make money on bad loans. Why do you think we had the 2008 crash? A big part of that was the banks taking bad loans and packaging them with triple A rated loans to make them look like good investments for pensioners and then they put insurance on these bad loan packages knowing full well they would fail, and they got paid huge cash profits on these bad loans when they failed. Do some homework on this. It is the same thing with the housing issues with foreclosed homes. Banks have actually found a way to make money on foreclosures and that is why they were pushing hard to foreclose on peoples homes.

 

[piasabird]

Wait till the IRS starts repossessing homes when you don't pay your health insurance under the ACA???

 

[Jaepheth]

Not killing...


Just lacking the decency to give a reach-around.