Can You Trust Big Banks With Your Money?

[marmar]

from In These Times:


Can You Trust Big Banks With Your Money?
The lesson from Cyprus: Your hard-earned savings can vanish in the vault.

BY Leo Gerard, United Steelworkers President


It’s hard to believe considering what happened in 2008 on Wall Street and in Washington, but banking is built on trust.

A worker hands his hard-earned dollars to a teller and trusts the money will be deposited and available for withdrawal when needed. Despite the crash on Wall Street, workers still trust bankers to safeguard deposits from robbers and reckless investments.

Granting banks a little less credulity might be wise. Just consider what happened in the past two weeks. A U.S. Senate investigation revealed that the 2010 Dodd-Frank banking reforms utterly failed in the case of the $6.2 billion “London Whale” gambling loss at JPMorgan Chase. Then a U.S. House committee passed seven measures to weaken Dodd-Frank. And there was the European Union’s demand that Cyprus expropriate money from depositors to prevent that nation’s big banks from failing. That means no depositor can trust that a government won’t dip its hands into savers’ accounts to bail too-big-to-fail banks. The trust is gone, baby.

Last week’s bad banking news began in Cyprus. It’s a cautionary tale about trust in both politicians and bankers. Cyprus is a tax haven for wealthy Russians the way the Caymans are for wealthy Americans. The Cypriot financial institutions, which made bad bets on Greek debt, are teetering on the edge of bankruptcy and were closed last week to stave off bank runs. .................(more)

The complete piece is at: http://inthesetimes.com/article/14784/banks_betrayal_and_bankruptcy/

[House of Roberts]

1. I pulled my money out of RBC in 2007 when they bought Amsouth branches from Regions Bank,

after Regions bought Amsouth. My account was sold to RBC, because it was opened at a branch that RBC bought from Regions. The employees of those branches were also sold to RBC. Since we were all treated like livestock, I moved all my banking to the Credit Union, where it will stay from now on.

[mainer]

4. I thought Royal Bank of Canada was one of the trustworthy ones

I know they didn't get into the same trouble as US banks did.

[House of Roberts]

5. This happened pre-crash

I didn't agree that I should be sold as a commodity in a bank merger/takeover. If I had been allowed to stay with Regions, after nearly 30 years as an Amsouth customer, I might not have moved. I was informed I couldn't open a new account with Regions for a year. RBC has already sold its branches to some other bank. Nobody else liked them either.

[dkf]

2. Money is based on trust period.

If the Government hyper inflates the currency they too can wreck its value.

Even gold is based on the idea that relative scarcity creates value.

Money has value because other people believe it has value.

[Demeter]

3. Trust but Verify--just don't ask how to verify!

If I had a mattress, I'd be stuffing it.

Since you can't trust the government, what with the active shredding of both the safety net and the Rule of Law, why would you expect to be able to trust the banks?

Trust...that's so 50's!

We are all living on a series of cliff edges...some of which we don't even know about. Yet. Until they crumble away beneath our trusting feet.


The whole point of a social group was mutual support...an extended family. Now, it's all about the benjamins: various forms of slavery and coercion so that the Might makes Right and the Right makes Policy.


We are a sad, sick shadow of our former national greatness.

I'm thinking Iceland. They might actually be having Spring, over there....

[blkmusclmachine]

6. Well ..

[amandabeech]

7. Google "bank ratings."

Different orgs have different ratings.

My preference is for community and regional banks that have been in business for some time. My home town in Michigan has a community bank that's been around since well before I was born during the middle of the baby boom. It doesn't get into any fancy "investments" that I have ever heard of and is highly rated everywhere I can find.

There are probably smaller banks like that everywhere, but do your research.