Los Angeles to the Banksters: Slow down the foreclosures or we're moving our money

[marmar]

ALL BUSINESS: Los Angeles gets tough on banks
Banks doing business with Los Angeles will have to prove community investment

Rachel Beck, AP Business Writer, On Friday March 12, 2010, 11:15 am EST


NEW YORK (AP) -- The city of Los Angeles is putting banks it does business with on the spot.

The unanimous directive coming from the city council is that banks need to help Los Angeles slow the pace of foreclosures ravaging its neighborhoods and battle a local unemployment rate that far exceeds the national average.

If the banks don't comply, they risk getting replaced by banks that do. The price for getting tossed: Lost access to nearly $30 billion in city savings and pension funds.

"We need to challenge the financing institutions that got us into this mess," says Richard Alarcon, a Democrat who introduced the city council's motion that passed 12-0 earlier this month. "Responsible local investments are critical for our economy."

Think of what's happening as a reward system for any banks that are willing to help Los Angeles's population of 3.8 million. ..........(more)

The complete piece is at: http://finance.yahoo.com/news/ALL-BUSINESS-Los-Angeles-gets-apf-21128764.html?x=0

[tabatha]

1. Good for him.

[AllentownJake]

2. They already are going as slow as possible

mark to market accounting and all.

[glowing]

3. Do it anyway. These banks suck. Get rid of them

[dkf]

4. Is this legal?

I always thought putting preconditions was kind of illegal. Where does loan money and stop foreclosing types of requests run into other beneficial deals? Will this now become status quo?