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"Too Big To Fail"

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April 25, 2010, the day before the scheduled Senate vote. The subject, a debate financial reform.

copyright 2010 Betsy L. Angert.

On April 25, 2010, a day before a vote that would decide whether the Senate would debate financial reform, Senator Bernie Sanders spoke of the oft-stated belief, some enormous economic engines are to "Too Big To Fail."

Senator Sanders presented the numbers beginning with the big four (4). Bernie Sanders bellowed, there are 4 major banks in our country. These are Bank of America, Wells Fargo, JP Morgan Chase, and CitiGroup. Many in the audience might have recalled that three of these Tapped the Fed for Financing in August 2007.

At the time, the fourth of these financial institutions, Wells Fargo, declined to comment in regards to its status. Rather than state whether this giant holder of greenbacks had borrowed from the Federal Reserve discount window, Wells Fargo declared it had "ample funds." By April 2010, the other depositories did as well. In the Spring of this year, actually days ago, headlines blared. Good news, Big Banks Are Back as JPMorgan, Citigroup Turn Corner. Perchance, ironically, as average Americans struggled to survive, Bloomberg Business Week reported there was reason for "optimism."

Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc. and Wells Fargo & Co., beneficiaries of $140 billion in taxpayer funds, reduced loan-loss provision expenses from last quarter and said the bottom of the credit cycle was past. Their investment-banking arms capitalized on fixed-income trading, leading to combined first-quarter profits of $13.4 billion, the most since the second quarter of 2007 before the crisis began. Citigroup reduced reserves for the first time since 2006.
As the bully banks built their revenues, Americans depleted theirs. Even when economic times are tough, or perhaps especially when it is difficult to make ends meet, in our Credit Card Nation: (we may be) Addicted to Debt. It is not that consumers wish to be obsessed with spending, scientists say, this might be habit. Purchasing patterns were well learned and established long before the current recession. After all, since the 1950s, Americans have been trained to say, charge it. Indeed, "More credit cards are issued in this country than any other country," said John Ulzheimer of That's nearly 700 million, more than two cards for every American.

In truth, in the last year and one half, people have cut back. Since the recent Recession began, people have tightened their purse strings. Nonetheless, circumstances did not allow them to climb out of debt. On March 5, 2010, cited a glaring truth; "Americans increased their overall consumer debt in January (2010) for the first time in a year, even as they continued to trim their credit card balances." The conclusion, "Unemployment remains a challenge."

As Americans count pennies, Bankers build bigger vaults. After all, fiscal tycoons invested well for many years. Financiers found a niche and a captive audience, one the money merchants now hold hostage. Statistically stated, Senator Bernie Sanders shared . . .

  • The four financial institutions issue 2/3 of the credit cards
  • The four fiscal stalwarts hold 1/2 of all mortgages
  • These giants own and control 7 Trillion Dollars which happens to be 50 percent of the Gross Domestic Product of the United States of America
Thus, the question must be asked. Is there reason for optimism when the banks do well, or might the bank profits correlate to greater consumer debt. Possibly, the answer to that query may not be as meaningful as the response to another. What can Americans expect once the Senate debates the essential question, "Are these financial institutions too big to fail or just too big to exist?" Will citizens remain at the mercy of the miserly billionaire Bankers, or will the American people be set free to financially flourish?

References in regards to Financial Reform . .

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