Dealing With The Banks!

As anyone who has read the papers or seen the news in the last few years knows, banks around the world have broken numerous serious laws, have had to be bailed out with taxpayers money, and yet still pay millions of dollars to inept executives and billions more to stockholders. I was reminded of this today when I looked at the Royal Bank’s financial statements showing that they made $221m in pure profit EVERY WEEK last year.  That is $221m of YOUR money given every week to someone else.

There has to be a better way, and there is.

I would oblige all banks to become credit unions and I would strictly limit their functionality.

Credit unions are not-for-profit institutions cooperatively owned by their members. They operate solely for the benefit of their members rather than for outside shareholders, of whom there would be none.  Their senior management is elected by the members and their policies are offered up for approval at regular meetings of the membership. Senior management remuneration would require members’ approval. The billions of dollars that are currently paid out in dividends to outsiders would be used to increase services and lower costs for the members. Any surplus could be re-paid to the members or added to the credit union’s capital.

I would limit their functionality to the taking, managing and disbursement of members’ deposits, and to the issuance of personal loans (including credit cards) and personal mortgages.  Any member or corporation that required business loans, corporate mortgages, investments or insurance would turn to investment companies, mortgage brokers and insurance companies designed specifically for that function.

No one would be limited in their desire to engage in stock market or other investments.  But these would be handled entirely by companies separate from banks.   No longer would bank depositors’ cash be at risk in the marketplace for derivatives, for example.

Competition between credit unions, if such were needed, would become a function of service and accessibility.  I believe this would get us more branches on the streets and a more personalized service between member and bank.  It would bring banking back to the people, to a smaller more human scale that we can understand and control — after all, it is our money they are using.

 

Advertisements

4 Responses to Dealing With The Banks!

  1. Ferry seagull says:

    See today’s Australian papers for the climbdown by PM Turnbull on holding an enquiry into banks.
    Even the banks want an enquiry to clean the air….

    NOVEMBER 30 2017 – 11:39AM
    PM Malcolm Turnbull announces royal commission into banking sector by Adam Gartrell Eryk Bagshaw

    smh.com.au/business/banking-and-finance/big-four-banks-tell-government-to-set-up-inquiry-20171129-gzvlfr.html

    and Mark Kenny comments
    ANALYSIS NOVEMBER 30 2017 – 12:46PM
    Banking royal commission: Government in name only as Malcolm Turnbull loses control of the politics by Mark Kenny
    smh.com.au/federal-politics/political-opinion/banking-royal-commission-government-in-name-only-as-malcolm-turnbull-loses-control-of-the-politics-20171129-gzvpj1.html

    • Ferry seagull says:

      Add in:
      ANALYSIS: Royal commission into banking: The Australian inquiry that could kill the Government
      By business editor Ian Verrender, ABC News
      Updated Mon at 12:56am
      One scandal after another

      ….Let’s backtrack just a little and examine our local industry’s record on scandals.
      Deutsche Bank analyst Mike Mangan, who now runs boutique funds manager 2MG, has compiled a neat summary of banks’ transgressions during the past decade [ documentcloud.org/documents/4310476-A-Summary-of-Bank-Transgressions-During-the-Past.html. ]
      It includes everything from the Storm financial crisis to rigging the Malaysian currency markets and providing bad financial advice.
      Since the financial crisis, Australian banks have forked out more than $1 billion in fines and compensation from rorting their own clients.
      There are a couple of observations to be made here…..

    • Grandview Citizen says:

      I’m sure the owners of the media in Australia have your Canadian-banking back, Ferry seagull.

  2. Grandview Citizen says:

    “I would oblige” implies that you’d somehow have risen to power in a coup or revolution that overthrew those who own Canada. Good luck with that. Or, would you have won the first ever election in Canadian history that miraculously did not go the way of the owner class? God save the Queen.

    Maybe a more realistic aspiration would be one where you convince the 10 people with whom you spend the most time to un-bank themselves.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: