Why Banks Can't Lend: U.S. Financial System "Not as Good as Wall Street Says"

[ShockediSay]

http://finance.yahoo.com/tech-ticker/why-banks-can%27t-lend-u.s.-financial-system-%22not-as-good-as-wall-street-says%22-437941.html;_ylt=AhRkfbw2.NBmOuFpXdMzwbW7YWsA;_ylu=X3oDMTE2cTVkdnJjBHBvcwMxMARzZWMDdG9wU3RvcmllcwRzbGsDd2h5YmFua3NjYW50?tickers=^DJI,^GSPC,xlf,uup,tbt,FAZ,FAS&sec=topStories&pos=8&asset=&ccode=


Based on the latest quarterly profile, for fourth-quarter 2009, the state of the banking system is "not as good as Wall Street is saying. Particularly when you get beyond the 'too big to fail' banks," Suttmeier tells Aaron in the accompanying clip.

Bad Banks Can't Lend As was widely reported, the most recent report showed the number of "problem" banks rose 27% in 2009 to 702 -- the highest level since 1993.

Less widely discussed is Suttmeier's concern that more than half of the nation's roughly 8,000 banks "can't lend anymore" because of rising levels of bad loans on their books. The problems are especially acute in construction & development and commercial real estate loans, he says, citing the FDIC quarterly report. Because so many of these loans are delinquent, banks don't have the capital coming in to lend out and thus are content to mostly sit on deposits, he explains.

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time to prop up main street lenders, even if at the expense of
biggies, what w/ their outrageous commissions, tax breaks and
bonuses

[Donnachaidh]

1. translation -- they want more money from the government

They spent all theirs on bonuses for the upper elites.