The Banking system has been infected with a deadly virus. Their uncontrolled and un-checked greed has become the AIDS of our society, voraciously devouring and killing it's host as it spreads rapidly and without restraint, to every fiber of our world.
So here I go again. I promised myself a few months back, that I would stop writing blogs about the abominable state of our financial system....that a more positive approach would be more welcome by those of us who attempt to create a brighter future through the power of a positive mental attitude.
I figured that my time would be best spent in worthy endeavors, rather than exposing the beast thru Active Rain. I suppose I was not strong enough to hold true to my promise, and I have succumbed once again to saying it like I see it.
The stimulus dollars we have thrown at the economy, is the bitter medicine that the tax-payer has taken on the promise of recovery, but immune to the cure, the disease has become stronger and it's coming back with a vengeance.
The monster is alive and well, and has now grown three heads. B of A, Chase and Wells Fargo have rapidly become the "waaaayyy too big to fail" financial entities of today.....no longer do we have the safety that numerous and diverse banking institutions bring to the table, where failure of one or 10 or 100, would pose little danger to the system.
I am not particularly fond of four-letter words, but I just couldn't stay away from the four-letter acronyms that the banking industry is full of....AIDS (All Inclusive Disaster System)....we could create new acronyms for the BIG THREE ...how'bout WBOA (Worst BANK OF AMERICA), CTAD (CHASE The Almighty Dollar), WFWG (WELL let'S see how FAR we GO)
We missed the chance. We have now crossed the line.... what we call in mountaineering, "the turn-around time"......."the point of no return". Failure of even one of these gangsters would make the Federal government rush to their help again.....only to postpone the inevitable!
It is no news that the stimulus money has gone into the banker's pockets. They gleefully boast of how many billions they made in past quarters, and we, the underlings are supposed to cheer them on and be happy.
But contrary to public belief, the banks did not learn their lesson....that is just impossible, they have no soul, ....they are a cancer interested only in sucking every drop of blood from our working families. We live in an Olygarchy, not a Democracy.
Even the president, having realized what an unforgivable blunder it was to hand these crooks billions of "un-accounted-for dollars", publicly shook his finger at them last week, and told them that there "would be no more bail-outs if they did not change their old habits".....oooooo....they were shaking in their boots ....as if they really gave a damn!
Let's look at the facts:
The billions of dollars in profit they recently showed, was mainly the result of the same risky type of investments that brought the economy to it's knees in the first place.
The loan modifications and other crumbs that are supposed to be thrown to the few that qualify for these programs, are just another vehicle for the banks to rob the consumer.
Banks are modifying loans that have adjusted into high interests rates, with other ARMs that will adjust again in a couple of years....why, using fixed rates would be unwise for the bottom line of these predators.
Banks are evaporating any available credit left in consumer credit cards, down to the balance owed. Although this practice is being hailed as "reducing the exposure" for the banks, the over-all effect is, that now people show their credit cards maxed out 100%, which in turn drops their FICO scores by at least 100 points or more, which makes them a high credit risk, which justifies the banks increasing your interest rates....you get the picture.
If you happen to qualify for a re-finance, these sharks are charging exhorbitant points and fees. Bank of America was recently charging one of my clients $12,000 in points and fees for a $210,000 re-fi with no cash out....luckily, my client had the where-with-all to tell them to stick it where the sun don't shine!
So all-in-all, they are killing the host. Analogically speaking, it's as if the banks are in the middle of the ocean on a raft made out of people, keeping them afloat. But their greed causes them to start cutting off limbs and pieces of these people to stockpile it as food, not realizing that the more they do this, the weaker and more vulnerable the raft gets, to the point that it can't keep them afloat anymore.....surprise, surprise , their vessel is sinking but they can't figure out how it's happening.
Credit card defaults have increased by 19%...and let's not forget that the banks are sitting on trillions of dollars worth of unsecured debt....but what are they doing? they are sending notices to consumers that due to new "Federal Laws and Regulations" (which don't take effect for a few more months), they will be increasing interest rates on existing balances anywhere from 22%to 29%, and in some cases more!
So hurry up! the new regulations are giving the credit card companies, a window of opportunity to drown the consumer even faster! ....but of course, the taxpayer can always "opt-out" of this carnage, provided that they send the bank a letter stating so.
So, first the consumer needs to read the notice that contains incomprehensible fine print, then, if they understand what they read, they can write a letter "opting out".
Of course, the bank will close their account but they are still responsible to pay off the balance at the old and bargain interest rate of about 18%, which in turn drops their FICO scores even more, which in turn in creases their minimum payment, which in turn.......you get my point, they have the working families by the cojones and on top of that, they are holding their heads under water......and we are supposed to believe Bernanke when he says that the recession is over?....and we are suppossed to keep this banking system alive?
Why couldn't the government come up with a stimulus program that allows consumers to refinance their unsecured credit card debt at a low interest rate, so they can have some breathing room and actually have a shot at paying off their debt?
FHA is practically out of money, USDA doesn't know if they will get more money for the new fiscal year starting Oct 1st, the stimulus money has gone into the banker's coffers with nothing to show for it, unemployment is at 12% or more in parts of the country, California is broke and so is NJ, IL, Conn., VT, FLA, AZ, NV, NY, HI .......and other states are getting there fast, and we keep printing money......
Did you know that the dollar is now cheaper than the japanese Yen, and has become the currency of preference to fund high risk investments? So while printing money is a piece of cake, we have not figured out yet how to make more gold...so at $1000/once, gold is a ganga.....just sit there and watch as it doubles in value in the next couple of years!
The only thing that we can count on, to continue to grow, is the Federal Debt (currently at $12 trillion...(that's 12 with 12 zeroes next to it!)
So hold on to your hats! Being that 2010 is an election year, money is drying up, and all the indicators are pointing to inevitable inflation, I would venture to say that we are in the eye of the storm, and that the apparent rebound of the stock market and Bernanke's "end of the recession", is merely an unsustainable mirage that will morph into a deeper crisis in 2010.
OK, now that I filled you with love, hope and that overall fuzzy feeling, I think I'll go grab myself some lunch.