What will credit unions do with all the new deposits? I'm assuming

[hedgehog]

that most of that money will go out to be reinvested. Mortgages? car loans?

[elaineb]

1. Exactly! Good thinking!

Do you suppose this movement's first collective action might quickly lead to the easing of credit that will finally start to get the economy growing again?

[hedgehog]

5. I can't see Credit unions financing a housing bubble - they can't take the risk!

[elaineb]

6. Exactly--they can't take the risk, nor do they want to, because profits aren't their goal

Big banks were *pretending* to take a risk by making unwise loans (knowing they were either going to sell them off quickly to investors and/or that they would get bailed out for the ones they kept on their books). Credit unions are non-profit institutions beholden to their members, so they always have their members' financial interest in mind. Not the financial interest of their top management and shareholders, as the banks do. I can't imagine there would have ever been a housing bubble if credit unions had been making the lending decisions.

[Motown_Johnny]

8. they could if they packaged the mortgages and sold them as derivatives

oh wait.....



never mind

[RainDog]

2. local small business loans, too n/t

[malaise]

3. College loans as well

:hi:

[BadgerKid]

4. Grinning here.

If so, I could see how Big Banks would have to start loaning again to be competitive. Power to the people.

[ThomWV]

7. If they have more funds in reserve than are necessary it should drive loan rates down

And that should lead to greater demand for loans for the sorts of things people finance through Credit Unions, which are generally the smaller of the big ticket items. That would include things like cars, educations, and world-tour vacations I suppose. I do know with certainty that the Credit Union we belong to does not do mortgages.