The image above has been flying around the internet the past couple days, graphically illustrating that it’s still true that often, a picture is worth a thousand words. (Click on it and take a good look.)
I am very well acquainted with a person, whose identity shall remain confidential, who in 1998 was working in a senior executive capacity for one of the banks listed on the chart above. Back then, 13 years ago, my acquaintance accurately predicted two of the mergers that happened in the ensuing two years, and said that by 2010 there would be five major US banks.
As you can see from the chart, my acquaintance missed it by one. There are four.
I’m not sure what will come of the “Occupy” movement now afoot; it could be the birth of a huge, new force in American life and politics; and it could be just another momentary diversion. I’m not as good as my acquaintance mentioned above in predicting things.
But I do know the “Occupy” movement has begun to tap into an emotion felt by millions of Americans. These people, these – for lack of a better name – Wall Street barons, have fleeced us for a long time. They wrecked the economy with their reckless – for lack of a better word – greed, their bundled subprime mortgages, their credit default swaps, their co-opting of the “ratings services”. They came out of it unscathed, and while they may not be bundling subprime mortgages any more, they’re no doubt doing similar things we’ll discover a decade from now, and all the while “feeing” us to death.
It’s far too simplistic, but the allegation of the so-called 99-percenters, “we’re too big to fail”, does resonate. They’re saying the middle class is what’s failing, and you can find plenty of evidence for that without looking too hard.
What can we do about it?
My wife and I have taken the first step. We’ve moved nearly all of our financial business to a locally-owned and locally-controlled financial institution (it’s a credit union), and by January, 100% of our financial business will be done and controlled right here in Madison.
It’s a first step, not a complete solution. But we think it’s a damn good start.
Yup.
ReplyDeleteWhen you come down to it, 'too big to fail' is really 'too damn big.'
And that fool Congress screwed it up with the repeal of Glass-Steagall. (I think that was Phil Gramm's move, but I'm not sure.)
That's not a bad solution; we do a lot of business with a local credit union.
ReplyDeleteI listen to "Planet Money," and they had a fascinating installment recently called "When Money Got Weird," pointing out that financial managers helped change how we think about everything: for example, airlines became commodities traders and currency exchange businesses that ran an airline on the side.
But the real problem is not big business, or small business, per se. It's how the businesses operate. There are lots of big businesses that work out just fine, and lots of small businesses that don't. "Too Big To Fail" has become shorthand for "we're going to bail you out," though, and that only works if the govt is going to demand changes in practices to avoid future bailouts for the same reason -- which didn't happen with TARP.
I’ve always thought that the society I live in was sane, that those little losses of equilibriums were temporary..Now I am guided be the thought that I may be the last generation in the experiment of living.
ReplyDeleteThe environment, the cohesiveness of human endeavor, those human, eternally functioning parts of society and the world, trip into insanity.
I am a moth circling the flame.
One Ring to rule them all, One Ring to find them,
ReplyDeleteOne Ring to bring them all and in the darkness bind them
In the Land of Goldman Sachs where the Shadows lie.
(Apologies to the prescient J.R.R. Tolkien)
The Goldman Sachs building, imagine it under a dark and lowering sky, looks a lot like Sauron's Tower.
http://goo.gl/lHmr7