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lofasz · 02-19-2009, 05:47 AM

Private banking is not a sustainable financial model. That is not to say they should be nationalized either. There is a third option.

In a private bank you have depositors, shareholders, over-paid executives, and taxes. I never quite understood how one dollar deposit could support paying both interest on my account and feed all those other blood-sucking leeches.

The answer of course is that one dollar deposit could not - that is what got us into this mess. The Fed lowered reserve requirements on the back end to make it look feasible. But today $1.00 deposit in a private bank is worth less than 10 cents (reserve requirement is less than 10%).

If not private banks or nationalization then what? The credit union model. The shareholders in a credit union are the depositors and the credit union itself does not pay taxes because the depositors pay taxes on the interest they earn on their own deposits. The executives at these institutions make a good living, but are not filthy rich like dick-heads at the major public banks.

Let banks fail, support your local credit union.

02-19-2009, 05:47 AM
lofasz Confirmed User Join Date: Oct 2008 Posts: 120	Private banking not a sustainable financial model anyway Private banking is not a sustainable financial model. That is not to say they should be nationalized either. There is a third option. In a private bank you have depositors, shareholders, over-paid executives, and taxes. I never quite understood how one dollar deposit could support paying both interest on my account and feed all those other blood-sucking leeches. The answer of course is that one dollar deposit could not - that is what got us into this mess. The Fed lowered reserve requirements on the back end to make it look feasible. But today $1.00 deposit in a private bank is worth less than 10 cents (reserve requirement is less than 10%). If not private banks or nationalization then what? The credit union model. The shareholders in a credit union are the depositors and the credit union itself does not pay taxes because the depositors pay taxes on the interest they earn on their own deposits. The executives at these institutions make a good living, but are not filthy rich like dick-heads at the major public banks. Let banks fail, support your local credit union.