Which party is more responsible for the state economy?

Lord Tammerlain · Nov 5, 2011

obvious Child said:
Indeed. I find it sad how he keeps posting the same refuted studies time after time after time despite being pointed out they have flaws the size of the Andromeda Galaxy. And he never addresses those flaws.

Absolutely. Furthermore, on a national scale the NPLs are mostly from non-CRA covered banks. I've never seen anyone who blames the CRA address that specific point with something other than saying that the overall push caused non-CRA banks to get in on it. Which may be true (and probably is), but no one made them do it.

Given the higher potenial profit from the subprime loans which Frannie and Freddie were traditionally unable to offer it could be argued that the competition for the growing subprime market (pushed by the non CRA regulated companies Countrywide, Ditech etc) pushed Frannie and Freddie into trying to cover that market as well. People should remain aware that even though the GSE were "covered by the government" they were for profit companies with non governmental ownership seeking a return

And flee the thread when challenged. Man, if this place keeps going like this, election season will be a literal hell here.

I am sure it will be

I had to take a leave for a while during the last election to keep my sanity from the idiocy.

I doubt the idiocy will be any better this time around, but most likely worse as the right has moved even more to the right, and the left has become rather more vocal then in the past on US domestic policy

apdst · Nov 5, 2011

Lord Tammerlain said:
Given the higher potenial profit from the subprime loans which Frannie and Freddie were traditionally unable to offer it could be argued that the competition for the growing subprime market (pushed by the non CRA regulated companies Countrywide, Ditech etc) pushed Frannie and Freddie into trying to cover that market as well. People should remain aware that even though the GSE were "covered by the government" they were for profit companies with non governmental ownership seeking a return

And flee the thread when challenged. Man, if this place keeps going like this, election season will be a literal hell here.

[/QUOTE]

Funny you should mention Countrywide.

Dodd and Countrywide - WSJ.com

Lord Tammerlain · Nov 5, 2011

apdst said:
Funny you should mention Countrywide.

Dodd and Countrywide - WSJ.com

So one senator out of 100 during a republican controlled senate, congress and with a republican president had more power then all of the republicans to ensure Countrywide was not going to be regulated by the republican congress, senate, and president?

Does that make Dodd the most powerfull person behind the financial industry bad lending or is Barney Frank the most powerfull man in the universe? able to over power hordes of conservatives in government, responsible bankers, and investors

The story tends to make Barney the most powerfull man in the US, able to direct policy even though all but the Supreme court was repubican/conservative at the time. If it is true that Barney Frank is the person to blame I sugest some knee pads for proper worship

apdst · Nov 5, 2011

Lord Tammerlain said:
Funny you should mention Countrywide.

Dodd and Countrywide - WSJ.com

So one senator out of 100 during a republican controlled senate, congress and with a republican president had more power then all of the republicans to ensure Countrywide was not going to be regulated by the republican congress, senate, and president?

Does that make Dodd the most powerfull person behind the financial industry bad lending or is Barney Frank the most powerfull man in the universe? able to over power hordes of conservatives in government, responsible bankers, and investors

The story tends to make Barney the most powerfull man in the US, able to direct policy even though all but the Supreme court was repubican/conservative at the time. If it is true that Barney Frank is the person to blame I sugest some knee pads for proper worship[/QUOTE]

Ordinarily, I might say no, but this senator just happens to be one of the two Democrats that were calling the shots at Fannie and Freddie.

I guess it doesn't matter, since you're convinced that the banks did this all on their own and the government doesn't share any responsibility.

obvious Child · Nov 5, 2011

apdst said:
I guess it doesn't matter, since you're convinced that the banks did this all on their own and the government doesn't share any responsibility.

Either you cannot read properly, or you simply ignore whatever you do not like.

Lord T made it perfectly clear the government shares responsibility in this mess:

http://www.debatepolitics.com/polls...sponsible-state-economy-8.html#post1059931701
http://www.debatepolitics.com/polls...sponsible-state-economy-8.html#post1059931719

How about you actually read for comprehension rather then just assume whatever the **** you want for a change?

This is the third time I've caught you with either a reading comprehension problem or a "I don't give a **** what you actually wrote and I'm just going to assume whatever I want you to say so I can attack you with a fabrication I obviously made and made no attempt to hide" problem in two weeks.

apdst · Nov 5, 2011

obvious Child said:
Either you cannot read properly, or you simply ignore whatever you do not like.

Lord T made it perfectly clear the government shares responsibility in this mess:

http://www.debatepolitics.com/polls...sponsible-state-economy-8.html#post1059931701
http://www.debatepolitics.com/polls...sponsible-state-economy-8.html#post1059931719

How about you actually read for comprehension rather then just assume whatever the **** you want for a change?

This is the third time I've caught you with either a reading comprehension problem or a "I don't give a **** what you actually wrote and I'm just going to assume whatever I want you to say so I can attack you with a fabrication I obviously made and made no attempt to hide" problem in two weeks.

Put me on ignore and do us all a favor.

Redress · Nov 5, 2011

Moderator's Warning:

OC, apdst, knock it off.

obvious Child · Nov 5, 2011

Christ sakes. It is too much to ask for people to respond to what people actually wrote rather then just making up in their heads whatever the hell they want?

X Factor · Nov 5, 2011

Catawba said:
That was an ugly thing to say to Ikari, and what makes it worse is that you provided absolutely nothing to back up your ugly words.

You should be ashamed of that post.

Quit being such a drama llama unless you're willing to call out everybody whose ever said something negative about a party they disagree with.

X Factor · Nov 5, 2011

obvious Child said:
Either you cannot read properly, or you simply ignore whatever you do not like.

Lord T made it perfectly clear the government shares responsibility in this mess:

http://www.debatepolitics.com/polls...sponsible-state-economy-8.html#post1059931701
http://www.debatepolitics.com/polls...sponsible-state-economy-8.html#post1059931719

How about you actually read for comprehension rather then just assume whatever the **** you want for a change?

This is the third time I've caught you with either a reading comprehension problem or a "I don't give a **** what you actually wrote and I'm just going to assume whatever I want you to say so I can attack you with a fabrication I obviously made and made no attempt to hide" problem in two weeks.

Maybe you should reexamine your own reading comprehension. I haven't read the second post you linked, but the first you use as evidence that Lord T put some blame on the govt doesn't do that at all. In fact, he's denying that putting pressure on banks to give loans to people who couldn't pay them back had anything to do with the housing bubble. He's actually saying the banks made those bad loans because they wanted to. How is any of that saying the government shares some blame?

Edit: Ok, looked at the second post and it's the same thing. It's poor Fannie and Freddie that were just being forced to try to compete with those unregulated, evil, private lending institutions. Not only is the govt not responsible, it's actually the victim.

LaughAtTheWorld · Nov 5, 2011

I'd say both parties are responsible, but my thinking that the Republicans (deregulation) are slightly more responsible. If there was an option for both parties, I would have opted for it, but it's just my opinion that the Republicans are just slightly more responsible. Yet it's close

X Factor · Nov 5, 2011

RadicalModerate said:
It's hard to say which one is responsible, since you'd have to account for complex accounting measures spanning the last 50 years or so. In the short term, I'd say the Iraq War, which the Republicans insisted on having, and the Bush tax cuts (which were implemented during a time of war; so much for national sacrifice) has been the biggest drain because it was unnecessary. People may not like the stimulus plan and TARP, but at least there was some rational justification for that. The Iraq war was completely unnecessary and the tax cuts were a disgusting political move.

Don't get me wrong, the Democrats are not blameless in this debacle. But if you are forcing me to choose, I must say the Republicans, in the short-term, have the most responsibility to bear.

obvious Child said:
The current state right now is both. The Republican obstructionism to prevent any improvement in the economy prior to the election next year coupled with the hardening of Democrats to compromise after Obama's rejection is creating a gridlock that is awful for business. How we got here in the first place is more Republican than democrat and more Corporate Idiocy than Republican. And it's more Greenspan's easy money than Corporate idiocy.

JohnWOlin said:
If I had to pick one as to which had more influence on today's economy through a long term outlook I would say the Republicans. The Republicans created the trickle-down economics that every president since Regan have championed, even when they claimed to be against them (Clinton, Obama) with the Republicans adding to the problems by lowering taxes early on into Bush's presidency which had a great short term economic effect but a very bad long-term that we will probably not recover from for another good while. Since Nixon on down, being nearly every president since Nixon we have been getting cozier and cozier with China and I strongly believe making China a strategic partner has greatly harmed United States.

Lord Tammerlain said:
I would say Republican.

The government policies that allowed the banks to take on excessive leverage were most predominately pushed by Republican party members

PeteEU said:
Republicans, but only barely.

It is the whole political system that is at fault, but it is the ideology of the Republican party that is the basis for much of the crisis we have today.

DaveFagan said:
The Republicans own the current financial disaster! No doubtr! The cost of the Iraq War, plus the Bush tax cuts broke the bank. When you put a moron in charge, you should expect less than desirable results. "Jus' bidness, don't ya' know!" And the rich got richer. Now, is that just a coincidence? Bush cronies. Gee, what a surprise. Ol' SoupForBrains was being honored at Goldman Sachs and the OWS people found out and were outside chanting for his arrest. Gee, I wonder why?

Proud South Korean said:
I'd say both parties are responsible, but my thinking that the Republicans (deregulation) are slightly more responsible. If there was an option for both parties, I would have opted for it, but it's just my opinion that the Republicans are just slightly more responsible. Yet it's close

I'm shocked by these results. SHOCKED I tell you. :shock:

:mrgreen:

lpast · Nov 5, 2011

cpwill said:
1. agreed the banks should have done better due diligence
2. the fact that you were able to get away with it does not excuse committing fraud

I agree fraud is a crime and shouldnt be allowed...but there should be very very few mortgages ever given based on fraudalent applications because all it takes is a cursory basic investigation.
1. Verify Employment, length, amt of income etc.
2. Credit Check
3. If necessary criminal background check.
4. Insist on a set downpayment % for every borrower/or only lend a set percentage of any market value.

Thats all on the lender, they actually make money off the origination fees they charge. The one thats giving their money is the one that has the responsiblity to assure that they are going to get it returned. Its the same as buyer beware.

Centinel · Nov 5, 2011

Catawba said:
Glass Steagall prevented banks too big to fail,

How did it prevent banks too big to fail?

they kept investment banking separate from commercial banking.

And why is it necessary to keep investment banking separate from commercial banking? What is that designed to protect us from?

whysoserious · Nov 5, 2011

Daktoria said:
Can you name one time Keynesian economics succeeded?

BTW, neocons <<< entire American right.

If this recession staves off a double dip, I would say during this recession you could look for it as evidence that it worked - considering how bad it was supposed to be. Unemployment actually capped at around 10%, which is not great but better than it could have been. However, I doubt as much was spent as what should have been since we could not afford to deficit spend since our we are already so far in the hole. That's the whole point of Keynesian economics and if we had practiced it, we would have room for expansion of spending to continue to stimulate the economy regains strength.

To me, Keynesian economics makes far more sense than any supply-side, "just keep not taxing the rich" idea. Combined with unchecked spending, it has earned us quite a bit of debt.

Lord Tammerlain · Nov 5, 2011

X Factor said:
Maybe you should reexamine your own reading comprehension. I haven't read the second post you linked, but the first you use as evidence that Lord T put some blame on the govt doesn't do that at all. In fact, he's denying that putting pressure on banks to give loans to people who couldn't pay them back had anything to do with the housing bubble. He's actually saying the banks made those bad loans because they wanted to. How is any of that saying the government shares some blame?

Edit: Ok, looked at the second post and it's the same thing. It's poor Fannie and Freddie that were just being forced to try to compete with those unregulated, evil, private lending institutions. Not only is the govt not responsible, it's actually the victim.

When did Freddie and Fannie force any financial instutition they did not want to? Why did Texas avoid the housing bubble when it is subject to the same federal regulations that Nevada (ie CRA, Fannie, Freddie among others), why did the UK and Ireland have housing bubbles depsite not being subject to the CRA or Fannie or Freddie, heck why did housing prices in Canada go up similarly in price (housing bubble that has not burst yet) despite not being subject to the CRA, Fannie and Freddie.

The point that should be obvious to anyone, the banks took on excess leverage and in the search for yield willingly provided loans to millions of people who should not have received them. They were able to make the loans, and sell them off as a means to unload the risk of the loan to someone else.

The govermnment played a part, it weakened regulations allowing for increased risk and leverage, it reduced the lending standards, and it did not regulate Fannie and Freddie properly. But as Texas should strick mortgage regulations by the government (in this case state regulations) can prevent the idiocy of banks to make loans they shouldnt, and stop people from making loans they shouldnt. Countrywide was never forced to make bad loans, it wanted to do so.

Lord Tammerlain · Nov 5, 2011

Centinel said:
How did it prevent banks too big to fail?

And why is it necessary to keep investment banking separate from commercial banking? What is that designed to protect us from?

Re the second point

It limited the amount of risk commercial banks could take on. By not being able to take on the risks that investment banks can and often do, the commercial banking industry would be more stable and less likely to require bailouts (especially those subject to the FDIC) In other words it was a firewall to prevent commercial banks putting the general populations savings at high risk

People put their money into BoA for safety, people put their money into Goldman to make a lot of money. By allowing BoA to act like Goldman, the safe place to put ones money was gone

whysoserious · Nov 5, 2011

whysoserious said:
If this recession staves off a double dip, I would say during this recession you could look for it as evidence that it worked - considering how bad it was supposed to be. Unemployment actually capped at around 10%, which is not great but better than it could have been. However, I am sure less was spent than what should have been since we could not afford to deficit spend due to our already large IOU bill. That's the whole point of Keynesian economics and if we had practiced it, we would have more room to continue expansion of spending to stimulate the economy until it regains strength.

To me, Keynesian economics makes far more sense than any supply-side, "just keep not taxing the rich" idea. Combined with unchecked spending, it has earned us quite a bit of debt.

Was I high when I wrote this 20 minutes ago? Half of the sentences don't even make sense. I fixed it to what it should be in the edit above since it was probably almost impossible to read before.

Centinel · Nov 5, 2011

Lord Tammerlain said:
Re the second point

It limited the amount of risk commercial banks could take on. By not being able to take on the risks that investment banks can and often do, the commercial banking industry would be more stable and less likely to require bailouts (especially those subject to the FDIC) In other words it was a firewall to prevent commercial banks putting the general populations savings at high risk

People put their money into BoA for safety, people put their money into Goldman to make a lot of money. By allowing BoA to act like Goldman, the safe place to put ones money was gone

Totally agree. Depositing one's money for safekeeping is a totally separate consumer activity than investing in stocks or bonds. In the former case, the deposit account acts as a secure extension of one's wallet and doesn't represent the acquisition of a financial instrument. The latter involves risking one's capital in a financial instrument, and is in essence a business venture.

The problem we have in our banking system is that when I deposit my money for safekeeping in my demand deposit account the bank embezzles my money and invests it as if it were its own. Yet the bank assures me that I continue to be the owner of my funds, and that I may withdraw them or use them to pay my rent at any time, when in fact the bank has taken my money and put it into God knows what investment.

It is impossible for two different people to simultaneously be the owner of the same asset. Either I own my deposited rend and grocery money, or the person to whom the bank has loaned it is the owner, but we cannot both be at the same time. The bank is creating a legally and economically untenable situation by taking what I supposedly own and loaning it to another entity. The same money is an asset on two people's balance sheets. Can you say financial bubble?

So I see how Glass-Steagall is an attempt to limit the level of risk I am placed under when the bank embezzles my money. For example, the bank loaning my deposited rent and grocery money to a local business is a good thing, while investing my rent and grocery money in a financial instrument is a bad thing. But that doesn't solve the underlying problem. If I deposit my rent and grocery money in a bank for safekeeping, and the bank takes my money, money I legally own and may withdraw at any time, and they use it for their own money-making investments, then they ought to be charged with embezzlement.

If I as a consumer wish to risk my money investing in equities, bonds, certificates of deposit, or any other business venture, then I am perfectly free to assess the risks, make the investment, and live with the profit or loss involved in my business decisions.

However, if I should also be able to choose to simply to keep my money in a secure facility and use that money to pay my rent and groceries. The depository institution should be required to hold every penny of my money in my account at all times for my immediate withdrawal, and as the legal bailee, the depository institution should be forbidden from putting my deposit at risk by embezzling my money and using it for their own business ventures.

That is the only way to prevent bank failures from impacting depositors. Glass-Steagall is just nibbling around the edges, because even supposedly safe business and farm loans can and have gone bad, wiping out depositors.

whysoserious · Nov 5, 2011

Centinel said:
Totally agree. Depositing one's money for safekeeping is a totally separate consumer activity than investing in stocks or bonds. In the former case, the deposit account acts as a secure extension of one's wallet and doesn't represent the acquisition of a financial instrument. The latter involves risking one's capital in a financial instrument.

The problem we have in our banking system is that when I deposit my money for safekeeping in my demand deposit account the bank embezzles my money and invests it as if it were its own. Yet the bank assures me that I continue to be the owner of my funds, and that I may withdraw them or use them to pay my rent at any time, when in fact the bank has taken my money and put it into God knows what investment.

I don't see how that is much of an issue as long as they have enough on hand to pay out what you need. To begin with, if you want to earn interest on your deposits, then you have to expect that they are going to be using your money on investments. Secondly, they are not just taking large amounts of your cash and investing it - there are very specific formulas they use to decide how much money they can take without taking on too much risk - keep in mind they are the ones who are liable so it is in their interest to safeguard your money.

For instance, currently I am trying to self-learn about how derivative prices are set based off of interest rates and market volatility. My only reason for bringing that up is because it is also a way to assess risk, cut losses, and defeat any market arbitrage. Though banks clearly screwed up by too much bad debt - leading too many failures in 2008 - generally they are pretty damn good at managing risk.

Lord Tammerlain · Nov 5, 2011

Centinel said:
Totally agree. Depositing one's money for safekeeping is a totally separate consumer activity than investing in stocks or bonds. In the former case, the deposit account acts as a secure extension of one's wallet and doesn't represent the acquisition of a financial instrument. The latter involves risking one's capital in a financial instrument, and is in essence a business venture.

The problem we have in our banking system is that when I deposit my money for safekeeping in my demand deposit account the bank embezzles my money and invests it as if it were its own. Yet the bank assures me that I continue to be the owner of my funds, and that I may withdraw them or use them to pay my rent at any time, when in fact the bank has taken my money and put it into God knows what investment.

It is impossible for two different people to simultaneously be the owner of the same asset. Either I own my deposited rend and grocery money, or the person to whom the bank has loaned it is the owner, but we cannot both be at the same time. The bank is creating a legally and economically untenable situation by taking what I supposedly own and loaning it to another entity. The same money is an asset on two people's balance sheets. Can you say financial bubble?

So I see how Glass-Steagall is an attempt to limit the level of risk I am placed under when the bank embezzles my money. For example, the bank loaning my deposited rent and grocery money to a local business is a good thing, while investing my rent and grocery money in a financial instrument is a bad thing. But that doesn't solve the underlying problem. If I deposit my rent and grocery money in a bank for safekeeping, and the bank takes my money, money I legally own and may withdraw at any time, and they use it for their own money-making investments, then they ought to be charged with embezzlement.

If I as a consumer wish to risk my money investing in equities, bonds, certificates of deposit, or any other business venture, then I am perfectly free to assess the risks, make the investment, and live with the profit or loss involved in my business decisions.

However, if I should also be able to choose to simply to keep my money in a secure facility and use that money to pay my rent and groceries. The depository institution should be required to hold every penny of my money in my account at all times for my immediate withdrawal, and as the legal bailee, the depository institution should be forbidden from putting my deposit at risk by embezzling my money and using it for their own business ventures.

That is the only way to prevent bank failures from impacting depositors. Glass-Steagall is just nibbling around the edges, because even supposedly safe business and farm loans can and have gone bad, wiping out depositors.

Of course the risk is not eliminated and never would be ( reason for the FDIC to exist)

As for the bank not being able to loan out the money that you deposited, if it did not do so, the fees you would have to pay would increase dramatically, and getting interest on your deposits would not occur at all

obvious Child · Nov 5, 2011

X Factor said:
Maybe you should reexamine your own reading comprehension. I haven't read the second post you linked, but the first you use as evidence that Lord T put some blame on the govt doesn't do that at all.

In fact, he's denying that putting pressure on banks to give loans to people who couldn't pay them back had anything to do with the housing bubble. He's actually saying the banks made those bad loans because they wanted to. How is any of that saying the government shares some blame?

Lord T:

Sure the federal government promoted home ownership

Hmmm. Government incentives creating a condition where banks increased questionable lending means that the government isn't at fault at all here? You sure you want to level that charge that I have a reading comprehension problem? I like how you jump on the CRA only issue while ignoring the conditions that partially caused non-CRA banks to engage in risky lending as proof that I can't read. That would be a lie of omission and you need to realize that people aren't as inherently lazy as you and will go back to cite portions that 1) prove you a liar and 2) prove you are wrong.

Try again. And with less fail.

Edit: Ok, looked at the second post and it's the same thing. It's poor Fannie and Freddie that were just being forced to try to compete with those unregulated, evil, private lending institutions. Not only is the govt not responsible, it's actually the victim.

pushed Frannie and Freddie into trying to cover that market as well. People should remain aware that even though the GSE were "covered by the government" they were for profit companies with non governmental ownership seeking a return

Hmmm. Looks like you are wrong again. Can I add you to the list of people with reading comprehension problems?

Centinel · Nov 5, 2011

whysoserious said:
I don't see how that is much of an issue as long as they have enough on hand to pay out what you need.

Yes, as long as the bank has enough on hand to satisfy depositors' withdrawals, everything should be fine. What could possibly go wrong?

To begin with, if you want to earn interest on your deposits, then you have to expect that they are going to be using your money on investments.

I don't wish to earn interest on my deposits. I want a guarantee that my deposits will always immediately be available for my exclusive use. When I deposit my money for safekeeping I am no more loaning it to the bank than I am loaning my coat to the coat check. It is mine, I am entrusting it for safekeeping, and I do not expect that the bailee is going to turn around and use the money for his own money-making purposes.

If I wanted to loan my money out at interest, I would buy bonds or certificates of deposit, and I would certainly not expect to simultaneously be capable of spending the money I just loaned out. Loaning money is a business proposition, and those who make loans must understand the risk of default and be prepared for the consequences. A loan also clearly transfers ownership of the asset from the lender to be borrower. The lender doesn't loan money and then expect that he can also simultaneously use the loaned funds to pay rent and buy groceries.

Lord Tammerlain said:
Of course the risk is not eliminated and never would be ( reason for the FDIC to exist)

Life is risk, so I agree that risk is never eliminated. But as soon as the bank embezzles my deposited money and uses it as their own they have set up the failure. The bank and I cannot simultaneously both own the same asset. That is the essential nature of the risk, not whether the bank invests the money in a local mortgage or in some other more risky financial instrument. As soon as they take my money and use it as if their own, they have put me, the depositor, at risk. That is what should be outlawed.

As for the bank not being able to loan out the money that you deposited, if it did not do so, the fees you would have to pay would increase dramatically, and getting interest on your deposits would not occur at all

I would never expect to earn interest on my deposits, since I am not loaning them. I am depositing them.

And of course, I would expect to pay for the services of keeping my money safe and for the various services of check clearing, debit card processing, online banking, etc.

As I said above, If I have money I wish to risk in a business venture, I would buy equities, bonds, or CDs. But I would undertake these investments knowing that they are risky and that I bear the risk. Deposits, on the other hand, should be 100% guaranteed, as they should only leave the bank when I withdraw them or cause them to be withdrawn through a check or debit card.

Lord Tammerlain · Nov 5, 2011

Centinel said:
If I wanted to loan my money out at interest, I would buy bonds or certificates of deposit, and I would certainly not expect to simultaneously be capable of spending the money I just loaned out. Loaning money is a business proposition, and those who make loans must understand the risk of default and be prepared for the consequences. A loan also clearly transfers ownership of the asset from the lender to be borrower. The lender doesn't loan money and then expect that he can also simultaneously use the loaned funds to pay rent and buy groceries.

Life is risk, so I agree that risk is never eliminated. But as soon as the bank embezzles my deposited money and uses it as their own they have set up the failure. The bank and I cannot simultaneously both own the same asset. That is the essential nature of the risk, not whether the bank invests the money in a local mortgage or in some other more risky financial instrument. As soon as they take my money and use it as if their own, they have put me, the depositor, at risk. That is what should be outlawed.

I would never expect to earn interest on my deposits, since I am not loaning them. I am depositing them.

And of course, I would expect to pay for the services of keeping my money safe and for the various services of check clearing, debit card processing, online banking, etc.

As I said above, If I have money I wish to risk in a business venture, I would buy equities, bonds, or CDs. But I would undertake these investments knowing that they are risky and that I bear the risk. Deposits, on the other hand, should be 100% guaranteed, as they should only leave the bank when I withdraw them or cause them to be withdrawn through a check or debit card.

What you would want would be a safety deposit box, not a savings account or chequeing account. Both the savings account and the chequeing account come with the general condition the bank will lend that money out.

A safety deposit box is yours and you do pay a few on it, the institution will not use the contents of it to further their own profits, and just do their best to safe guard it.

Regarding savings accounts, the bank does not own that money, just has it as assets under management. Commercial banks used to have more restrictions on how they used that money, and the depositer had a better understanding of the risk of depositing it into a commercial bank

Centinel · Nov 5, 2011

Lord Tammerlain said:
What you would want would be a safety deposit box, not a savings account or chequeing account. Both the savings account and the chequeing account come with the general condition the bank will lend that money out.

A safety deposit box is yours and you do pay a few on it, the institution will not use the contents of it to further their own profits, and just do their best to safe guard it.

Regarding savings accounts, the bank does not own that money, just has it as assets under management. Commercial banks used to have more restrictions on how they used that money, and the depositer had a better understanding of the risk of depositing it into a commercial bank

No, I don't want a safe deposit box. I want a checking account that contractually prohibits the bank from lending out my money. It would 100% eliminate the possibility that I as a depositor would be left holding the bag if the bank's investments go sour. I would then not need Glass-Steagall or the FDIC to protect me.

The Glass-Steagall is trying to solve the problem the wrong way. Regulating whether banks may invest only in morgtages or whether they may invest in exotic financial instruments is closing the barn door after the horse is out. The root of the problem is that the bank is loaning out money that depositors consider as their assets. The same dollar cannot be simultaneously owned by two different people. That is the root of the problem.

And if the response is that depositors would rather have their interest, well then they are not depositors, they are either lenders or investors, and as such I see no reason why the government has any obligation to backstop any lender's or investor's risk.

Which party is more responsible for the state economy?

Which party is more responsible for the state of the economy?

The Republican Party

The Democratic Party

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