WHY BANKS AREN’T LENDING: THE SILENT LIQUIDITY SQUEEZE

No fool you would have preferred for the total banking system of the US to suffered a collapsed instead that would had made the 1920s banks failures look like a walk in the park.

Once the mortgage crisis hit there was no choice but to pour money into the banking system or watch the whole country economic system be destroy.

Yes, it would had been far better to have had better oversight on the banking system in the first place but as the GOP would even to this day tell you that is uncalled for interfere with the free market.

Forcing the banking system now to loan more funds also would go again the GOP/tea party ideals.

Footnote private businesses are now sitting on a mountian of funds also and if we live in a sane society the government would be telling them to either invested the funds into their businesses or we will tax it away from you.

The word you seem to be looking for is "confiscate", and not "tax".

That money has BEEN taxed, and lawfully belongs to the companies. They're sitting on it until the US government is back under adult supervision and it makes sense to try to do something with it. They're certainly not sitting on it because they enjoy getting one percent interest on it.

Used whatever word you care to used.

In any case, so the government should have no rights to tax anyone for any reason?

Wonder how you think even a minimum government is going to work or do you wish for a world of no public police, fire department, national defenses. public roads, schools?

In any case those corporations used the public infrastucture to gain that wealth under rules that the public had every right to change for the public welfare. Right now the rules/laws are being written for their benefits with little concern of the society as a whole.

Rome had a private fire department once own by one man who would bargain with the property owners to sell their property that was on fire at the time.

If and only if they sold the property to him or his agents would his firemen put out the fire.

Is that your ideal world?

Here is information on the kind of future you would care to bring us all.

http://en.wikipedia.org/wiki/Marcus_Licinius_Crassus


Footnote this gentleman had his own private legions at his command also. Stating that you could not consider yourself rich unless you have your own private legions.

Is the basic idea here just to get the last word in no matter how stupid you have to sound in doing it?

No I was just wondering why it is ok and moral in your world view for companies to spend hundreds of millions a year to lobby government to passed laws that allow then to gather billions of dollars a year and keep it but it is not ok for the public to demand that they used some of that wealth in a manner that benefit the public good or give it to the treasury?

Only laws and tax rates that totally benefit corporations should be allow is that your position and any thing else is evil seizing of their "hard" earn or hard lobby for wealth.

Footnote corporations are a total creations and creatures of governments being view as a pseudo persons under the law.

As I noted, money which companies earn has already been taxed, and legally belongs to the companies; they are free to do whatever they please with it and they are not obligated to help Bork Obunga escape the logical consequences of his own actions or the actions of his party.

Is there some reason why you're not demanding the govt. take back all or part of the 1.6T in "excess reserves" which it has created (under Obunga's watch) for banks to sit on and collect interest (from us) on?

http://webofdebt.wordpress.com/2011/07/15/why-banks-aren%E2%80%99t-lending-the-silent-liquidity-squeeze/

Oh GE if my memory is servicing me correctly for example paid no taxes for a numbers of years thanks to the hard work of their lobbies.

Ok it nice to know that I and my wife had paid more taxes on our incomes then GE had in 2010.

I can see why you would not wish them to pay any more then zero on 14.2 billions in profits as it would be morally wrong wrong. Hell it worst then zero as they got pay 3 plus billions by the treasury.

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GE's corporate tax bill: Zero
The company didn't pay any US taxes in 2010. In fact, it got a tax benefit of $3.2 billion. With video updates.
By Kim Peterson on Fri, Mar 25, 2011 2:02 PM

Slogging through your taxes right now? Maybe you could hire someone from General Electric (GE) to help.

The company has beaten Uncle Sam. It paid no U.S. taxes for 2010, The New York Times reported. In fact, it received a tax benefit of $3.2 billion. It's not that GE can claim poverty. The company rang up $14.2 billion in profits last year, including $5.1 billion from U.S. operations.How did GE do it? Through what the Times describes as "innovative accounting" and fierce lobbying, GE has been cutting its tax bill for years. In a stroke of genius, it hired a former Treasury official to lead its tax department and filled its team with former IRS employees and Congressional tax specialists.

The top corporate tax rate is supposed to be 35% -- one of the highest in the world. But few companies actually pay that rate, since there are myriad loopholes and other ways to get breaks. Now, the Times reports, only 6.6% of Uncle Sam's tax revenue comes from corporations (down from 30% in the 1950s).

That's all very interesting, Bill. Does it have some relationship to the issue of banks being paid to not lend money, which is what happens when they receive interest on excess reserves?

What is excess reserves in a normal economic is not excess reserves in this economic.

You tea party finance experts here might know when banks had a large amount of their total loans outstanding going bad they need one hell of large reserves of cash equivalents on hand to keep in business. That is the very reason that the Fed shoved a trillion or so dollars into the banking system.

You do not tie such reserves up in long terms loans or at least you do not do so until the situation get stabilize.

Do any of you see the forecloses rate getting better and now we have the tea party running wild and about to cause the prime rate to go through the ceiling.

To sum up I am as unhappy at anyone that the damn GOP Congress removed a great amount of the oversight on the banks during the Bush years and the taxpayers then ended up needing to pick up the tab.

That is still better however then going back to a barter system.

Suggest you people take economic 101 102 and even 201 and 202.

I am looking forward at least to getting a higher rate of return on my savings thank to the tea party silliness even if it once more set the economic back a few years.

It never as simple as the right wings nuts claims it is.

BofA Was Pressed by SEC on Reserves for Mortgage Repurchases
April 04, 2011, 6:56 PM EDT
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E-mail Print By Dakin Campbell


(April 4 (Bloomberg) -- Bank of America Corp., in an exchange of letters with U.S. regulators that lasted over a year, was pressed for information about its reserves to cover the cost of buying back faulty home loans.

“Discuss the level and type of repurchase requests you are receiving, and any trends that have been identified, including your success rates in avoiding settling the claim,” the Securities and Exchange Commission said in a Jan. 29, 2010, letter to the Charlotte, North Carolina-based bank that was released today. “Tell us and disclose in future filings how you establish repurchase reserves for various representations and warranties that you have made.”

Bank of America, the largest U.S. lender, said Jan. 21 this year that resolving disputes could cost as much as $7 billion to $10 billion more, after setting aside $4.1 billion in the fourth quarter. The company has been battling accusations that mortgage investors were duped into buying loans issued with overstated property values and inflated borrowers’ incomes.

The 2010 document was one of at least a dozen letters exchanged by the regulator and the bank over disclosures tied to credit cards, home-equity loans and the establishment of reserves. The SEC said Feb. 18 that it had reviewed the company’s filings, including one on Jan. 21 of this year, and had no further comments. Such correspondence is typically released about six weeks after an SEC review is complete.

‘It’s Not Unusual’

“It’s not unusual for the SEC to have questions about our regulatory filings and as the letters indicate we responded to those questions and the issues appear to be resolved,” Bank of America spokesman Jerry Dubrowski said in a phone interview.

Regulators released correspondence with Citigroup Inc. last month that showed the SEC had questions about the New York-based bank’s representation and warranties going back to April of last year. Wells Fargo & Co. received a similar letter.

“More thoroughly discuss the risks and uncertainties associated with developing your estimated liability for representations and warranties, particularly in situations where you have limited experience dealing with certain counterparties,” the SEC said in the April 30 letter to Citigroup.

--Editors: Dan Reichl, Peter Eichenbaum

To contact the reporter on this story: Dakin Campbell in San Francisco at [email protected]

To contact the editor responsible for this story: David Scheer at [email protected]

READER DISCUSSION

Are the rather lengthy replies intended to convince someone you actually addressed the question? They didn't, but they were indeed long.

Yes I know the simple answer that it is Obama fault is the only acceptable answer you are willing to hear,

Any thing more complex that is beyond you and the average tea party member.