Well the sub-prime loans didn’t work out too well, but banks are still rolling in the dough. They are finding plenty of new opportunities for profits:
- JP Morgan pays $410m settlement (BBC article) – I have no idea about the legality of JP Morgan’s involvement with manipulating energy markets in the US, but I’m sure they are happy to settle this case and avoid too much publicity in the matter. Barclays was also fined for similar behavior.
- Goldman Sacs and others manipulate the aluminum market (Hufington Post article) – I think that people are sympathetic that banks exist to make money. The outrage comes from literally moving aluminum from one warehouse to another, just to manipulate the price. This does not provide value to the industry, and this is a waste of time, money, fuel, and pollution. How many times a week are you purchasing aluminum products?
- Did you hear the one about the bank getting a life insurance policy on their staff? (WSJ article) – I’m not witty enough to come up with a punchline for this one. But I can tell you that this is absolutely true. I know someone working at a bank, none of the banks listed in the linked article, but apparently the year before he started the bank offered employees $1,000 if they would sign for a life insurance policy that the bank would be the beneficiary of. Rumor has it, the bank then securitized these policies and sold them off. It’s bad enough if your employer has financial incentive to end your life, but now it’s some unknown person out there. I predict a rising demand for professional hit-men.
- Banks use taxpayer money to pay Lobbyists (Business Week article) – not once but at least twice if you read the whole article. Another case of hidden fees so convoluted, the customer has no idea what they are paying for. I guess the banks thought our state governments have plenty of wealth to share.
- And of course, Terrorists need a safe institution to hold their funds (wordpress post of Agence France Presse article)
Earlier this week I was convinced by Charlie Reese’s article that 545 senators and congressmen were to blame for any problem in the US, but now I’m thinking it’s the banks managers.
Soon to be Blunders?
- Brian M. Lucey points out a WSJ article announcing banks to create securities backed by rental agreements… It’s not illegal yet, what will a sub-prime rental agreement look like?