What are the Banks Doing With Your Money - They Are Not Using it to Simulate the Private Sector--That means that they are not using your money to stimulate the economy through growth in the Private Sector. That is accomplished by lending to Developers and to Homeowners. Growth in the Real Estate Industry has long been seen as the backbone of prosperity for the U.S. economy and for us all. The dream of every American to own their own home has been a ground base of stimulation and growth for our economy.

I've had this huge question in my mind since the October 2008 Bail Outs and that is....what happened to all that money. If we can't get loans for the Consumer then where is all that money?

The fact is we can't get loans for the Consumer. We all know that there is no longer a 21 day escrow. We are lucky if we can get it done in 60 days. I had a 90 days escrow on a FHA loan. I kept having this thought....what is going on with the Banks?

So I am going to share this link that David, my husband gave me that pieces the puzzle together for me. I am not an authority on this subject and so I cannot verify from a "connecting the dots" point of view if this fits with what is going on in the U.S. economy. I can say that it makes sense to me in terms of what we see going on with lending to the Consumer?

It even becomes more eye-opening when you ask the question "So if the bail out money is not being used to lend then what are the banks doing with the money that the Consumer deposits with the bank?"

Read the article here.

Here are two excepts from the article:

• The Wall Street Journal, for example, on Wednesday reported in an article entitled “Lending Falls at Epic Pace” that last year’s decline in lending is the biggest since 1942.
• If we mark the beginning of the financial crisis with the collapse of Bear Stearns in March 2008, data from the Federal Reserve show that since then bank lending has declined by $220 billion. During this same period, banks increased the amount of US government paper they hold by $337 billion.

It all makes sense to me and will not let me sleep well tonight! Inquiring minds must know. I would love for Jeff Corbett to give his perspective on this article and the ramifications of what is occuring. Why would the goverment and the banks enter into this death spiral? Is it intentional?

What should we do and how can we be effective in helping to change this economic mess ..... I searched for a word and do not have an appropriate word for the descriptive magnitude of how I see this trend. I don't know what to call this and remain objective.

I hate being helpless and having to watch something horrible that I have no control over. I feel like I'm tied up in the trunk of a car and just came to!

What are the Banks Doing With Your Money - They Are Not Using it to Simulate the Private Sector--Inquiring minds do want to know. What say you?

I am Jeanean Gendron, your Redding and Shasta County Specialist. I can be reached at 530 276-7417. I answer my phone.