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Democrat causes Bank Failure?

Mike

Well-known member
Saturday, 12 Jul 2008
How Chuck Schumer Caused the Second Largest Bank Failure in US History
Posted By:Jerry Bowyer



Jerry Bowyer
Kudlow & Co. Contributor
Federal officials aren’t supposed to cause bank runs. In fact, much of the New Deal bank regulatory apparatus was set up for the purpose of eliminating such panics. When FDR was hit with a massive set of bank runs shortly after taking office, he gave an address in order to calm terrified depositors, assuring them that the banks would reopen shortly, and that everything would be fine. But Chuck Schumer is no FDR. He doesn’t stop bank runs; he starts them. Or, at least, has started one. The collapse of Indymac bank, the second largest bank failure in American history, began with a letter from the office of Senator Charles Schumer on June 27. He questioned the viability of the bank. When a senior senator who is in a number of influential posts regarding oversight of bank regulators directly attacks the confidence of a depository institution, it matters. Not surprisingly, the director of the Office of Thrift Supervision concluded that the collapse of the bank immediately following the Senator’s comments was not a coincidence. Director Reich concluded that Senator Schumer had ‘given the bank a heart attack’.

Why? Why would a federal official with enormous power, destroy an institution on which tens of thousands of depositors (not all of whom are insured) and employees depend? Why would a New York Senator attack a Pasadena bank, acting as some sort of amateur, self-appointed, long-distance bank examiner?

Perhaps this might help answer the question: Indymac has been under attack from the hard left. The Center for Responsible Lending issued an attack on Indymac within a few days of Schumer’s letter. CRL is part of a small army of left of center ‘research’ groups, community organizers, and public interest law firms who make their living accusing home lenders of racial redlining and predatory lending. On June 20th the Center accused Indymac of unfair practices regarding minority borrowers.

A suspicious person might think that a network of lefty attack groups proficient in bank bashing and frequently funded by trial lawyers and short-sellers, coordinated their activities with a law firm on the hunt and a Senator who works closely with the network.

On the other hand, maybe it is a coincidence that CRL and Sen. Schumer attacked the same bank in the same week. Maybe he didn’t know about the CRL report, nor CRL about his letter. Maybe the community group didn’t know about the trial-lawyer class action lawsuit which was launched against Indy a couple of weeks before all of this started.

Yeah, right.


What Other CNBC Commentators Are Saying

The political class is shifting left. We’re likely to get Obama and Nancy and Harry running the most advanced economy in the world next year. The investor class doesn’t like what it sees coming. That’s why it is scaling back. Capital is going on strike, and we won’t come back to the table until we see that we have a chance to a fair deal.

What are other CNBC.com guest commentators saying?

________________________


Jerry Bowyer is chief economist at Benchmark Financial Network, is a member of the Kudlow Caucus, and makes regular appearances on CNBC. He also writes extensively on finance and history for the National Review, The Pittsburgh Post Gazette, Crosswalk.com, and The New York Sun. He can be emailed at [email protected]
 

Mike

Well-known member
Looks to me like the Dems are having fun ruining the economy in America just to take control of government.

Doom and Gloom and more of the same. :roll:
 

MoGal

Well-known member
10,000 depositors had over $100,000 in accounts at IndyMac........ they have lost $1 billion.

From the comments on Mish's blogspot:



CNN to their credit had some poor guy standing in front of his IndyMac branch in the dark waiting for the door to open later this morning. Get this: He has his LIFE SAVINGS in the bank 250K! He claims he was told that if he spread it around different accounts, that he had 100K insurance on each account. Now he was told that this was true only if there was a different name on each account. He seemed shell shocked. Still, FDIC says he will get some of that 150K back if the selling price of IndyMac is high enough.

Listen my friends, these banks are insolvent......... BANK ASSETS are debts owed to the bank... people need to realize that bank assets are not capital in the sense that you or I own capital........ if you own your car title free and clear that is an asset. The only way banks get assets is by people going into debt.... (helloooo, perhaps we should be asking why no one can pay cash for anything anymore and has to take on a note just to buy anything)......... these bank assets are disappearing because people are insolvent, they cannot pay the note of these bank "assets"

PLEASE check with your family, friends, especially the elderly and make sure they do not have more than $100,000 PER BANK.

The FDIC only has 67 billion to cover all these bank failures and many are saying there will be over 300 banks fail within the next 2 years.....
 
A

Anonymous

Guest
I agree Mike--Thats blasphemy for one of the peoples representatives to question any actions or issues happening in the country that affects our economy....Don't those folks know they are supposed to just rubber stamp all actions of the King and his Court- and not question them... :???:

And God forbid that they do it openly and transparently so that the common folk become aware of whats happening...We wouldn't want those folks to actually learn the truth.... :wink: :lol: :(

BULLPUCKEY-- this is just a farcical way to try and redirect blame away from years of corruption, fraud, and greed in Corporate Banking which was allowed to occur by absolutely no oversight or regulation of a bunch of crooks...
One letter didn't immediately bring a bank down.....

Even Paulson and Bernake last week, when they appeared in front of Congress, admitted that lack of any oversight was the cause of the whole housing scandal-as they are now asking for even tougher rules against lending institutions...
 

fff

Well-known member
Mike said:
Looks to me like the Dems are having fun ruining the economy in America just to take control of government.

Doom and Gloom and more of the same. :roll:

Runing the economy? Don't you know it's all in your mind? Don't be such a whiner! :lol: :lol:
 

fff

Well-known member
The Federal Reserve has twice as many banks on their "watch" list as they had this time last year. IndyMac wasn't even on the list! Now that's scary. We use a locally owned bank. The owner is also in the oil business, so it's probably solvent.
 

Sandhusker

Well-known member
The strength of the bank depends largely on the quality of the loan portfio. If you're concerned about your bank, find out what their loans are for. The only guys going down are the idiots who pressed the limits in housing notes. I don't feel sorry for them.

Also, that FDIC insurance is $100,000 per account. If you're married, set up one owned by John and one owned by Mary - both will be covered for the 100.
 

fff

Well-known member
Sandhusker said:
The strength of the bank depends largely on the quality of the loan portfio. If you're concerned about your bank, find out what their loans are for. The only guys going down are the idiots who pressed the limits in housing notes. I don't feel sorry for them.

Also, that FDIC insurance is $100,000 per account. If you're married, set up one owned by John and one owned by Mary - both will be covered for the 100.

No, the FDIC insurance is $100,000 per institution, not per account. Depending on how accounts are set up, you may qualify for more insurance.

http://www.lscb.com/Insuring_Your_Deposits.pdf
 

Sandhusker

Well-known member
fff said:
Sandhusker said:
The strength of the bank depends largely on the quality of the loan portfio. If you're concerned about your bank, find out what their loans are for. The only guys going down are the idiots who pressed the limits in housing notes. I don't feel sorry for them.

Also, that FDIC insurance is $100,000 per account. If you're married, set up one owned by John and one owned by Mary - both will be covered for the 100.

No, the FDIC insurance is $100,000 per institution, not per account. Depending on how accounts are set up, you may qualify for more insurance.

http://www.lscb.com/Insuring_Your_Deposits.pdf

Go talk to your bank
 

fff

Well-known member
Sandhusker said:
fff said:
Sandhusker said:
The strength of the bank depends largely on the quality of the loan portfio. If you're concerned about your bank, find out what their loans are for. The only guys going down are the idiots who pressed the limits in housing notes. I don't feel sorry for them.

Also, that FDIC insurance is $100,000 per account. If you're married, set up one owned by John and one owned by Mary - both will be covered for the 100.

No, the FDIC insurance is $100,000 per institution, not per account. Depending on how accounts are set up, you may qualify for more insurance.

http://www.lscb.com/Insuring_Your_Deposits.pdf

Go talk to your bank

Bank employees don't always know. In fact, I recently saw a survey that said someone did a survey and called banks with FDIC questions. Something like 85% of the time the employees at the bank gave the wrong information.

I just got off the phone with the FDIC. Individuals are covered at one institution for $100,000. IRA and some other retirement accounts get $250,000 coverage.

Here's the FDIC website: http://www.fdic.gov/deposit/deposits/insuringdeposits/index.html

And here's what it says:

The basic insurance amount is $100,000 per depositor per insured bank. Certain retirement accounts, such as Individual Retirement Accounts, are insured up to $250,000 per depositor per insured bank.
 

Sandhusker

Well-known member
It's not necessarily per depositor as it first seems. You can have a $100K CD, your wife a $100K CD, and both of you can have 100K CDs with one the owner and POD do your kids. Therefore, if you have 5 kids, you can have 1.2 Million covered at the same bank.

You can also buy additional FDIC insurance if you want.

And, by the way, Schumer is an idiot. If he'd of kept his yaw shut instead of trying to play political games, this might not of happened.
 

per

Well-known member
The bottom line is be prepared. Spread you liquid assets out. Limit your debt. Stay away from assets that depreciate as they too often are actually liabilities. Look for opportunities.
 
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