Barrett Rainey's Second Thoughts

If there’s any one trait all of us share on this earth, it’s a desire to be liked and/or respected. As children, we focus on those around us to whom being liked is important – parents, siblings, kids at school, etc.. We share, and are shared with, in the quest to be liked. That desire may later become linked to a desire to be respected. For most, it’s just the natural way of things.

Unless you’re a bank!

If you’re a bank – especially a large bank – there is an endemic nature to tell everyone how “likeable” you are – thru advertising – while conducting day-to-day affairs with an “I-don’t-give-a-damn-what-you-think” attitude – thru actual business practices.

Sum up all the motivations in the “Occupy” movement that have people in streets around the world right now, and you’ll find financial issues in nearly all of them. Further distilled – especially in this country – it’s banks, stock traders and mortgage lenders. The people who have our money or control how we spend our money. In the American version of “Occupy” the co-equal is a congress that can’t give competent directions to the nearest men’s room. But that’s another story for another time.

All this comes to mind at the moment because this is the month when most major financial corporations disclose their profit-and-loss figures for the recent quarter. What we’re learning from banking reports is certain to add more fuel to the “Occupy” fire. It does mine.

Here’s just one example. From July thru September, Bank of America (BofA) had a net profit of $6.2 billion. A year ago, it lost $7.3 billion for the same period. That’s a cash swing of $13.5 billion UP in 12 months! Where do you suppose most of that came from?

Now, on top of that stash, BofA is implementing a $5 monthly charge on all customers who use the debit card BofA wants you to use because it reduces massive amounts of paper shuffling with checks. Which they DON’T want you to use. If BofA has, for example, about three million customers at any one time, that’s “found” money of $15 million a month – $180 million a year – for which the bank does nothing – provides no additional service – incurs no additional cost – actually reduces its own cost because you aren’t writing those nasty checks.

But there’s more. Bof A is closing 10% of its branches nationwide and putting 30,000 people out of work!

So what does BofA Chief Executive Brian Moynihan have to say about the outrageous profit, the debit card blackmail and putting 30,000 Americans into the unemployment line? Just eight words: “We have a right to make a profit.” “We have a right to make a profit.” Now, isn’t that likeable?

In the last two weeks, Citi Corp., Wells Fargo, J.P. Morgan and other major banks have produced similar numbers. Profits in the many billions in just three months. Added to their other billions in the previous six months. So where do you think all those billions came from? Where?

And there’s more. These banks are in business today, taking in billions in profits, because of what? Because you and I loaned them more than $40 billion – $40 billion – in bailout funds when these outfits had their backs to the financial wall three years ago. Some of them have missed the payback dates. Try that with your friendly banker and see what treatment you get.

Still more. Collectively, these same corporations – with their Olympic-sized profits – are using millions of those dollars from that profit pile to hire lobbyists to kill recently-enacted laws governing their activities. AND other regulations they don’t like. They’re actively fighting imposition of new capital requirements banks in other countries have lived with for years. They’ve gotten so arrogant in such affairs that corporate leaders in other major businesses are worried these banks they do business with – left to their own devices – will drive us back into another financial meltdown.

And the issue of home foreclosures? Banks have done literally nothing to address them unless forced to do so. By regulators. They’re going about business as usual. Rather than become good citizens – respected citizens – they continue to amass profit while exhibiting – in large letters – the same “I-DON’T-GIVE-A-DAMN” attitude we all know and hate.

Big banks are losing customers. Lots of ‘em. Small banks – community banks and credit unions – are growing. And will continue to grow until the hated biggies change the way they do business. Still, they don’t care.

So, millions of us are in the streets. While our reasons for protesting are numerous and varied, it’s the “thieves-in-the-temple” that have brought many of us out. Government has failed to clean up their financial act with laws and regulations. Government will continue to fail. So maybe depositors, by the millions, can do what an impotent congress has not and will not: force change.

Seems there are adequate laws to keep us from robbing banks. But none that are effective to keep them from robbing us.

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