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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Thursday, August 18, 2011

Bank Consolidations Must Stop

Hello everyone.  Larry here once again.  I know I am not here that often these days but am proud to say that Joyce has been doing a great job in her daily posts.  I am also happy to announce that our readership has also increased.  I must also attribute this to the fine job Joyce is doing.  Keep up the good work Joyce.

Larry's Corner

The trend of bank consolidations in this country must stop.  The era of Too Big To Fail must end.  In fact, it is time for many banking giants to be broken up and return to more manageable size with more emphasis on customer service then on over stated profits.  Banks like any other company should grow and profit through increased revenue derived from competitive business practices serving and servicing their customers.

Growth through acquisition has never worked as we saw back in the 1980's when consolidations and mergers were the daily drink.  Eventually, most all of these mergers divested themselves of all but their core businesses with most returning to increased profitability, higher stock values, better customer service benefiting both their stockholders and customer base.

Now here comes Capital One Bank best known for its credit card business and all those "what's in your wallet" television advertisements.  (In case they don't know it, "what's in most people's wallets" in the U.S. is no cash).  Yes, some still have plastic but just like the explosive "plastique" (C-4) these cards have and will continue to explode driving more and more people into economic disaster.  Once again, we cannot use debt to cure the debt crisis either nationally or individually.

Today I received an email from The House Committee on Financial Services whose ranking member is Barney Frank wherein he sent out a letter asking Ben Bernanke, Chairman of The Federal Reserve for more time to have the public respond to the pending acquisition of ING Direct by Capital One Bank.  This acquisition would make Capital One the fifth largest bank in the U.S.

Here now, a copy of Frank's letter to Bernanke:
Note that he is asking for public hearings to be held "to explore the impact of this acquisition on consumers, communities and the economy in general".

I must whole heartedly agree with Congressman Frank on this one.  It appear from the sound of his letter that this is going to be another Federal Reserve ramrod down the throats of the American People.  We spent years breaking up monopolies now we are spending years and government resources on creating monopolies to the detriment of this entire nation.

This pending purchase would be Capital One's second purchase as they had announced earlier their intent to acquire HSBC's credit card business as well.

As reported in the Wall Street Journal,
The deals would make Capital One the nation's fifth-largest bank by deposits and an even larger credit-card lender. Jason Arnold, an analyst with RBC Capital Markets, wrote in a research note last week the two deals "will be an alley-oop dunk if the two-part play is executed successfully."  (read the full here)
In a Reuters report today on this topic,
Frank cited concerns about the transaction's impact on consolidation of banking assets, the availability of credit from the resulting bank and community programs.
"A number of national consumer, civil rights and housing advocacy groups have raised concerns about the practices of the acquiring bank, including its track record with regard to previous acquisitions," Frank said in the letter.
"These concerns merit an extension of the comment period in order to allow a thorough investigation," he said.
In a lengthy statement in response to Frank's letter, Capital One said the ING deal would actually decrease its risk profile and would expand public access to banking services.
The Capital One response in part said,
"After the acquisition, the resulting institution, with just over $300 billion in assets, remains very much in line with other regional banks in terms of size and simplicity," Capital One said. "(The) combined organization will remain well below the trillion dollar balance sheets of the largest U.S. banks and will not engage in the types of risky investment banking activities that can generate systemic risk."
How can Capital One even say  "the resulting institution, with just over $300 billion in assets, remains very much in line with other regional banks in terms of size and simplicity," 

They are not saying they would create the fifth largest "regional bank" in the U.S., this acquisition would  make them the fifth largest bank in the United States.  They go on to say that their size would be in line with other regional banks in "terms of size and simplicity".  Do they really think we are all that stupid.  How can the fifth largest bank in the entire United States operate with "simplicity"?  What Viking drugs are in Capital One's wallet that they are taking to make such a statement?

The ING deal stems from an agreement the Dutch banking company had made with the European Commission following a 2008 Dutch government bailout.(Read it all here)

From Reuters,
ING had to sell the business, one of the jewels of its retail banking franchise, as part of a deal with the European Commission following its October 2008 Dutch government bailout.
My feelings folks is that ING should be negotiating a deal with someone on their side of the pond.  While this division of ING Direct may be a very viable entity - it is called "the jewel" of ING, perhaps a merger with a true smaller regional bank would be more effective.  In addition it would probably help create a few more jobs and elevate a smaller bank into higher profitability giving them an opportunity for expansion and the creation of new jobs without making it a "powerhouse" and Too Big Too Fail.

Let the People Be Heard on this one.  If you oppose this acquisition or if you agree with it, let your voice be heard.  Send a letter to Ben Bernanke at the address shown on Barney Frank's letter above or use this link to email your comments to The Fed.

Mr. Bernanke, let's have public debate on this issue.  The people have this right and even though you work for a private company, not part of the U.S. government in any way, shape, manner or form, you should still be accountable to "the people".   Some say your position is more powerful then even the Presidency of the United States.  I believe so as well.  You have entirely too much power internationally and work entirely too independently to serve the real needs of the American people.  

Grant Congressman Frank's request for an extension of time for public hearings on the Capital One purchase of ING Direct.  Let the people be heard.

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Anonymous said...


Obama vs. Ron Paul: The Big Issues

Anonymous said...

The One World Company

Daniel Estulin, noted expert on the Bilderbergers, describes that secretive globalist group as “a medium of bringing together financial institutions which are the world’s most powerful and most predatory financial interests.” Writing in June 2011, he said:

Bilderberg isn’t a secret society. . . . It’s a meeting of people who represent a certain ideology. . . . Not OWG [One World Government] or NWO [New World Order] as too many people mistakenly believe. Rather, the ideology is of a ONE WORLD COMPANY LIMITED.

It seems the Bilderbergers are less interested in governing the world than in owning the world. The “world company” was a term first used at a Bilderberger meeting in Canada in 1968 by George Ball, U.S. Undersecretary of State for Economic Affairs and a managing director of banking giants Lehman Brothers and Kuhn Loeb. The world company was to be a new form of colonialism, in which global assets would be acquired by economic rather than military coercion. The company would extend across national boundaries, aggressively engaging in mergers and acquisitions until the assets of the world were subsumed under one privately-owned corporation, with nation-states subservient to a private international central banking system.

Anonymous said...

Liquidity Trap (Zero Bound, Moribund - Economy) on the Horizon?!

Anonymous said...

Another reason we need a Ron Paul

Bank of America's Dead Drop To Rick Perry: "We Will Help You Out"

Anonymous said...

Can anyone explain why this story fell on deaf ears?

Is the SEC Covering Up Wall Street Crimes?A whistle-blower claims that over the past two decades, the agency has destroyed records of thousands of investigations, whitewashing the files of some of the nation's worst financial criminals.

Anonymous said...

There’s no greater evil against our great country of America, than those who are paid public tax dollars and swear an oath to pretend to defend the Constitution of the United States against enemies foreign and domestic – only to betray that high level of public trust – for personal gains!

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