Bank Lending Down Despite Massive Bailouts And Increasing Regulations

bloomberg.com:

While financial institutions including Citigroup Inc. and Bank of America Corp. have received more than $200 billion in capital from the government, they are limiting loans at a time of mounting unemployment, rising company bankruptcies and increasing regulatory oversight. Commercial and industrial lending has dropped 17 percent since October 2008, according to Federal Reserve data.

Read the whole story: bloomberg.com

Comments

[oath of fealty]

Stock market surging while main street keeps getting squeezed

good articles: http://financeopinionss.blogspot.com

It looks like 9-8% unemployment is the new normal since the govt. wants ppl to be unemployed. Otherwise we would have REAL shovel ready projects and green jobs instead of the BS we have now.

[Skeetshooter]

Too big to fail = too greedy to live.

[sloreader]

I'll let you know about your credit line the day after I get my bonus!

[TJCole]

Because we failed to Nationalize them the bailouts were nothing but one big rip off..!

Nationalization was in the tax payers best interest, instead they got the gold mine, and we got the shaft..!

We could have been using the banks to help stimulate the economy rather than constricting it as they have and are still doing..!

[snapshot1940]

Does any rock headed conservative need any more proof that the "Trickle down" theory doesn't work? Or did they know this all along and just didn't give a damn?

[BernankeMadoff3]

Economy is rigged against middle & lower class

good articles: http://financeopinionss.blogspot.com

health care reform is good, but we also need better financial reform. no more bailouts

[TradeLosses]

Lets all pray that the health care bill doesn't get stonewalled in the Senate...

good articles; http://financeopinions.blogspot.com

This is just one step in a staircase of much needed reforms after 8 years of destruction.

[studmoose]

Did you guys learn anything yet about the Fed and their partner banks?

DID YOU!

[PhilipTaylor]

That is simple to explain!

BANKSTERS SCAMMED AND SKIMMED OFF $700 TRILLION OVER THE LAST 9 YEARS LEAVING BANKS CASH REGISTERS EMPTY AND EXECUTIVE AND EMPLOYEE POCKETS FULL.

So all $23.7 Trillion of the Bailout, FDIC, and FED money (a small fraction of the skimmed amount) is going into the EMPTY CASH REGISTERS and to further the SKIMMING Operation!

They need $Hundreds of Trillions to offset the HIDDEN "Off-Balance-Sheet" skimming they did the last 9 years and yes to continue the SKIMMING Operation these OUTRAGEOUS Incomes require.

So Nothing left to LOAN Main Street or Urban America!

[World Citizen]

It’s time for OBAMA to consider that Bernanke and Geithner's solution of propping up of big banks is the WRONG SOLUTION.

Glass-Steagall Act should be reinstated to break up the Too-Big-To-Fail banks!

Before the repeal-of- Glass-Steagall, which was signed into law by Clinton on Nov/12/1999, Congressional Research Service prepared a report which explored the case for preserving Glass-Steagall.

Arguments for preserving (means-NOT -REPEALING ) Glass-Steagall:

1. CONFLICTS OF INTEREST characterize the granting of credit — lending — and the use of credit — investing — by the same entity, which led to abuses that originally produced the Act.

2. Depository institutions possess ENORMOUS FINANCIAL POWER, by virtue of their control of other people’s money; its extent must be limited to ensure soundness and competition in the market for funds, whether loans or investments.

3. Securities activities can be risky, leading to enormous losses. Such losses could THREATEN the INTEGRITY OF DEPOSITS. Government insures deposits and could be required to pay large sums if depository institutions were to collapse as the result of securities losses.

4. Depository institutions are supposed to be managed to limit risk. Their managers thus MAY NOT BE CONDITIONED TO OPERATE PRUDENTLY in more speculative securities businesses. An example is the crash of real-estate investment-trusts sponsored by bank holding companies (in 1970s/1980s).

HELLO-OBAM­A???-ANYBO DY THERE??? All-of-the-above arguments came true. Why is OBAMA's administration against restoring the Glass-Steagall?

[vippy]

The banks took our money and bought oil big time, they rented super tankers off-shore and that is where they store the oil. Now we are swimming in oil but the price is not going down for they are set to rape us with high gasoline prices. Imagine what they have done with our money! And do you see our leaders doing anything about it? It should be clear to all of us that we have something like the Mafia in charge of our country. And the 30 billions in bonuses to be shelled out is just unfathomable.
What about the derivatives? Ask yourself why have those not been addressed yet. Where are they taking us all the while saying we have a jobless recovery, which reminds me of the Bush Years when GWB bragged about the many new homeowners, which now live in tents! Think about it. And while you are at, vote 3rd party, nothing else, our only way to fight back if those elections are not fixed.

[iridium53]

Correction - the banks did not take our money.
The Federal Government took our money and gave it to the banks - no strings attached.

[EvSenter]

I think it would drastically improve the mortgage default rates of individual home owners (the first and continuing cause of the meltdown) if we created an agency that offers to lenders to "work out" all delinquent mortgages so that most home owners can stay in their homes, with reduced payments and possibly reduced balances, so that they once again have some equity and affordable payments. This agency would buy the delinquent mortgages at 30% so that the agency had bargaining room to make those options available to the home owner(s). This has already been done for some individual mortgages by former executives of Countrywide. The agency could reach a places that private enterprise could not reach, such as mortgage backed securities (MBS).

This may be like the first domino, that, if it does not fall, allows all the rest of the dominoes to remain standing. It does not guarantee that some other domino won't fall, but the real estate domino seems to be key domino.

And the real estate domino is not yet stable. It is reported that not even 1/4 of the mortgages that are in default have gone through foreclosure. If the inventory of unsold real estate is in excess now, it is going to get much worse before it gets better. I'm not sure the banks (i.e.: the system) will survive the next tranche of home foreclosures, much less the commercial loan defaults to follow.

[World Citizen]

It might be time for OBAMA to wonder if Bernanke and Geithner's solution of propping up of big banks is the WRONG SOLUTION.

Glass-Steagall Act should be reinstated to break up the Too-Big-To-Fail banks!

Before the repeal-of-­Glass-Stea­gall, which was signed into law by Clinton on November/12/1999, Congressional Research Service prepared a report which explored the case for preserving Glass-Steagall.

Arguments for preserving (means-NOT­-REPEALING­) Glass-Steagall:

1. CONFLICTS OF INTEREST characterize the granting of credit — lending — and the use of credit — investing — by the same entity, which led to abuses that originally produced the Act.

2. Depository institutions possess ENORMOUS FINANCIAL POWER, by virtue of their control of other people’s money; its extent must be limited to ensure soundness and competition in the market for funds, whether loans or investments.

3. Securities activities can be risky, leading to enormous losses. Such losses could THREATEN the INTEGRITY OF DEPOSITS. Government insures deposits and could be required to pay large sums if depository institutions were to collapse as the result of securities losses.

4. Depository institutions are supposed to be managed to limit risk. Their managers thus MAY NOT BE CONDITIONED TO OPERATE PRUDENTLY in more speculative securities businesses. An example is the crash of real-estate investment-trusts sponsored by bank holding companies (in 1970s/1980s).

HELLO-OBAM­A???-ANYBO­DY THERE??? All-of-the-above arguments came true. Why is OBAMA's administration against restoring the Glass-Steagall?

[cigi]

Why would the Big Banks lend??? They can hold the $$$$, send it around the world each day and rake in more profits for themselves­...lending involves risk...24 hour deals make them look better to the WStreeters and their quarter to quarter mentality. Americans need to wake up to the fact that investing in WS is risky and ill advised as these guys win, even if you have to lose for it to happen. It used to be that folks invested for the long term...not anymore...life is just about Instant Gratificat­ion...Happ­y Meal mentality America!

[NevadaPatriot]

This is class warfare.

The American Government only function is to provide socialism for the rich.