It is a sad commentary on our society when the biggest bank robbers in our nation happen to be the biggest banks in the nation, robbing the rest of us.
We have experienced a lessening of personal service in our bigger banks. It sure makes me appreciate the good, personal service I get at a small bank here in our small community. Along with the lessening of big bank personal services has been a lot of new charges for what used to be free, and a lot of those new or increased charges have come without much in the way of valid explanation or advance notice.
Not only has it become depersonalized over past years with almost inaccessibility at times, but the new charges and requirements of banking actually make it more expensive and, in some ways, more time-consuming than before.
Remember just a few years back when banks strayed out of their traditional element and bought and bounced mortgages all over the country with lack of personal quality formation and handling? The result was thousands of mortgages that should never have been made and an expectable, unfortunate litany of painful foreclosures. There was determination of “too big to fail” and then huge bailouts at extreme cost to us taxpayers.
After they got their huge bailouts, they failed to use the funds as contemplated and intended to help the overall economy. Instead, they sat on the money and got re-established and richer with profits from just investing the money sent to “save” their bank operation. The bailout might have been great for the receiving banks, but it didn’t do what it could have for others.
Now the corporate greed of several bigger banking institutions goes way beyond the recent extension of their traditional conservative mortgaging, where they got into ill-founded mortgage games playing, selling and trading poorly crafted mortgage paper to who knows where. A few of those same institutions are setting up to be in cartel position to boost prices and discourage competition completely outside any definition of traditional banking function, but all to their huge profit.
Goldman Sachs alone bought out Metro Int’l Trade Services, one of the largest metal traders in the country, and, in so doing, acquired all of its aluminum, which apparently constitutes about a fourth of the aluminum supply available in the country.
Then it engaged in the abhorrent concerted practice of just hauling loads of aluminum it now owns from one of 27 warehouses it owns in the Detroit area to another warehouse it owns in the Detroit area. It does this over and over and over again. Because it apparently can do this without sanction and can, as a result, increase its pricing with storage, handling and time delay, it can raise the price to consumers, including manufacturers, which, in turn, increase cost to you, me and everybody else who purchases anything containing aluminum.
According to the New York Times investigation, and relying on statements of industry executives and analysts, just this one action of Goldman Sachs has cost American consumers more than $5 billion over the last three years. In addition, its delay for profit has caused manufacturers and other users to wait up to 16 weeks and more for aluminum products that the former owner used to provide in an average of six weeks.
And all of that is done without providing any service with the product or adding to the value of the product one iota.
Goldman excuses its conduct by hiding behind an arcane pricing formula that is set or standards applied to the London Metal Exchange. Apparently our Federal Reserve Board could decline to continue the exemption that allows such behavior, but don’t hold your breath. Congress could decide to get more involved in meaningful regulation, but again, don’t hold your breath.
It would be nice if we, the public, could get interested enough and active enough to halt such senseless, costly action. If something isn’t done soon, there apparently will be more of the same.
Apparently, our Securities and Exchange Commission opened the door last year for Goldman Sachs, JP Morgan Chase and the Blackstone Group to corner the market on up to 80 percent of our copper. So Goldman may soon be piling copper on top of its aluminum, or vice versa, in Detroit and elsewhere.
Then what? And what will it take to bring such shenanigans to a halt?
You could say up to now that a biggest bank is robbing us blind, but after exposure by the New York Times investigation, you can say that it, and likely a couple others, will continue to rob us, just not quite as blindly.