Banks charging crazy new fees because THEY HAVE TOO MUCH MONEY.

[Atman]

In the NYT today. I just posted this in another thread, but it needs its own;

Literally, banks are so flooded with cash they simply don't want/can't take anymore. Literally can't take anymore money, so they're coming up with ridiculous fees on people to discourage deposits. I am not making this up. We bailed them out, gave them the US Treasury, and in turn we can't get a loan and are charged $5 for accessing our own money.

OWS.

Just sayin'.

[TreasonousBastard]

1. Yet another wrinkle...

I had assumed many of the new fees were partly to chase off small depositors that weren't all that profitable. Seems that's true, but not just because they're losing money on your small bit of business.

[OneGrassRoot]

2. Hopefully that will change after 11/5: Bank Transfer Day...

when people change to credit unions and community banks.

:)

But that's a very interesting point you raise, Atman. Thanks.

[Swede Atlanta]

3. This doesn't surprise me and is a symptom.......

of the dramatic situation we face. The Republican strategy of just sitting and waiting this President out until the next election before agreeing to ANYTHING will mean the demise of the U.S. as a tier 1 country.

The problem is, some people are paying down debt and starting to save. Others have bailed from the securities and bond markets because both are volatile and looking to park their money in a money market, CD or other "cash" account. Since the banks aren't lending money either because their credit worthiness requirements are too steep for many would-be borrowers or because their is insufficient demand, money continues to pile up. The banks have to pay FDIC an insurance premium on the money. If they aren't going to be lending any of that money, either to borrowers or other banks, it sits worthless on their ledgers. So having additional money in depositor accounts actually costs them money. So they will charge you to keep your money in their bank.

This is how screwed up things are and the R's will do absolutely nothing to acknowledge the calamity that is upon us. And trust me if they do take back the Senate and the WH next year the situation will only worsen. Newt, "lizard man" Gingrich predicted that with a Republican majority in both houses of Congress and the WH, the recovery would begin on election night 2012. What a bunch of horseshit. They will lower takes even more on the wealthy, shaft the working man, strip unions of any rights they may have, undo the HCR bill, banking and financial reform, etc. and let the free market or "you are on your own" run its course.

[Atman]

5. BINGO! Well stated.

"This doesn't surprise me and is a symptom.......

of the dramatic situation we face. The Republican strategy of just sitting and waiting this President out until the next election before agreeing to ANYTHING will mean the demise of the U.S. as a tier 1 country."

[FarCenter]

4. What are the credit union going to do with excess deposits after Nov 5?

I guess that they can push them up to the Corporate Credit Unions who can invest them in sort term assets.

But the credit unions will have the same problem as the banks with low interest rates on short term fixed income paper.

Meanwhile Bank of America's position will improve due to fewer small high-cost accounts and a few billion less in deposits.

Another reason for BofA to shed depositors is that they are up against the statutory limit for percent of deposits beyond which they can't do more bank acquisitions. If they scrape off enough depositors, they might be able to do more mergers again.

[Atman]

6. I know this wasn't supposed to be the Thread Of The Century, but...

...the fact that only a few people responded, no discussion...THAT IS PART OF THE PROBLEM. No one knows what is really going on out there! We type our tantrums, we get all hot n' bothered about the Daily Outrage, but coming to a real understanding of the depth of America's serious, serious problem seems boring, I guess. This is really at the heart of all of our socio-political issue. Capitalism has officially failed. The people out to make all the money made all the money. Ain't none left to make. But we keep clamoring for an Obama or a Romney to make us all better. It's not going to happen. We are at the end of an era, the era of Capitalism. Now that all of the money has been sucked out of the economy, the only thing left is to get it back into a new economy. And like it or not, that is only going to start with revolution. Sadly, it will probably end without safety nets like Social Security, Medicare, or the galvanizing force of labor organized against the Corporate profiteers. That's the way "they" want it. That's the way it will be unless we stop this charade of betting on four-year horse races and start actually thinking about the futures of our kids and grandkids.