If you were to take the space inside an almond shell, that would be the amount of banking knowledge I hold. That is the deposit/withdrawal part of banking. I completely understand that segment of the industry. The rest of it is nebulous.
OH, I know that Bank of America can lose an original power of attorney. They lost one for me, thanks for that.
Other than that I am pretty blank on the subject but as always I don't let that stand in the way of having an opinion. Or two. Or several. So, here we go.
When I first married, as in the first time, I started to learn about credit. I learned from my new husband that in order to have credit you had to borrow money. Without credit you couldn't buy a car or a house or anything you couldn't afford. THAT should have been a clue. So the objective was to borrow money from a lending institution so you could pay it back to borrow more money.
See how clear that is? Me either. Why not just save money and then buy what you need? NO, that doesn't work because life is about getting something first and then buying it. Love that car? Get it, then pay for it. Love that furniture? Get it, then pay for it. Love those clothes? Get them, then pay. See. That's how life goes. That is how finances go down the toilet.
Banks at some point decided that they should offer credit cards to accommodate our need to have things now. Banks were considerate enough to tell us how much debt we could carry by setting a limit for us. How thoughtful. That way you knew you could put ten thousand dollars on a little piece of plastic and get everything you ever dreamed of. Then you could pay for it for just a few dollars a month for just a few decades.
Banks decided that those credit cards should have nominal fees for the privilege of having one and/or large interest rates. You could charge a one hundred dollar dinner and end up paying for it three years later for only three times it's value. YAY. Such a deal. The more credit you had the more money you had, right?
No. The more credit you had the more debt you acquired. The longer it took you to pay it off the more interest you paid. Great deal for the lenders, not so much for you. So, to entice you even more they added premiums. Gimmes. Air line miles, points, cash back. The idea being to spend money you don't have to get airline tickets you can't afford that you can use during allowed flying times.
Then the banks decided that debit cards would be so convenient. Swipe that card, push debit and, bam, you are walking away with your purchase and maybe an overdraft fee. I have never used debit cards but I know people who believe in them like they are gold. They are also always in disagreement with the bank over their account balance. Why? Oops, they forgot THAT purchase or THAT payment that drafts automatically. So now spending actual money costs money.
This has all been so convenient that now the banks want to charge fees to use the money you put in their bank with the card they wanted you to use. No thanks.
OK, that is the part of banking I sort of understand.
Here is the part I don't get. The lending of HUGE amounts of money for homes and businesses. First of all buying a house requires at least seven trees for the paperwork you have to sign. Anything that convoluted has got to be suspicious. Second, the largest part of your mortgage payment is the interest. Why? Ask the lender and they will immediately start speaking finance. I don't speak finance. I speak common sense.
At some point the banks decided that you could have a house you couldn't afford by paying what you can afford now and the the mortgage would adjust, not on your schedule, theirs. Then the banks decided what the hell, let's just lend money and you merely pay the interest and when you have the money, or hell is frozen, you pay all the principle at once. This was popular in areas like Honolulu where a shack may cost a million dollars. You pay nothing but interest until you sell the shack. You give the bank a million and you keep the rest. Great deal for the banks yet again. Those shacks don't hold their value in down economic times. You sell your million dollar shack for half it's value and you still owe the other half. Oops. That's a bitch.
Then somehow the banks all went broke at once. Fannie May and Freddie Mack vomited debt all over America so we saved them. We, the tax payers, many of whom were about to lose our homes. Banks were too big to fail. We bailed them out. Banks foreclosed on homes they knew people couldn't afford when they gave them a mortgage. Then they sat on the money too scared to do anything.
Businesses continued laying people off to survive. Good for business, bad for people. Which is ultimately bad for business because unemployed people can't buy anything. Some of the upper echelon executives in the banks took their parachutes and ran. Others stayed put to "fix" the banking industry.
They fixed it alright. They fixed it by adding more fees and lending less money. They fixed it by giving big bonus money to big boys who came up with the lame brained ideas on how to lend and get the biggest bank bang for the buck.
Well, as you have heard, people are angry at the banks and at wall street. People don't want to keep their money in the banks that screwed them in the first place. Banks are crying foul and bringing in SWAT teams to ensure that people can't take their money.
Remember, this is America. Not some European country trying to pass austerity measures. We have had austerity shoved down our throats. We have no choice but to be austere because, obviously, somewhere along the way, people started using capitalism to death. You see hoarders on the TeeVee. People who cannot throw anything away and are compelled to buy more stuff.
The banks are hoarders. They are hoarding our money. Just like the corporations who will not hire because the future is uncertain. They have the money, they just can't bring themselves to use or lend it.
Thank heaven we had visionaries somewhere in the past who threw caution to the wind. People who had faith in themselves and their country. Then came the aptly named robber barons. The government finally smacked them down so the middle class could survive. Now those of the same ilk own the government. In other words, we are screwed.
Here is what I have gleaned to fill the almond sized nugget of banking knowledge in a nutshell so to speak. If the bank wants you to do something, have this credit card, this debit card, refinance your house, deposit everything you have here, they are somehow screwing you. If the bank refuses to let you have your money, they are screwing you. If the bank refuses to lend you money because 7 years ago you missed a car payment, they are screwing you.
SO, here is my plan. One pound coffee cans buried in the yard with all my money, one can should do. Then several large dogs to roam the yard. Savings, done.
Then I plan to keep an account at a credit union to pay bills and cash checks. I will spend MONEY. I know, PhD. in "DUH" for me.
Money, spending cash. Spending paper and coin. Wow, how clever. How simple.
How unAmerican.
I am all for it,
Lillybell Blues
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