(Warning – Today’s post is heavy on gripe and light on wisdom)
All across the world, let alone the United States, trillions of dollars are sitting idle earning literally no interest in most bank accounts. In the United States, the target interest rate is set by the Federal Reserve, so these institutions that we entrust as stewards and keepers of our hard earned money can pass the buck (you like that one right 🙂 on why your checking account never grows. “We don’t set the rates…” If it were only the interest rates to complain about, I would wrap it up right now, but it is far from it. Over the past 15 years, our banking institutions have repeatedly been an embarrassment on almost every level of capitalism. Here are some recent headlines:
JP Morgan – The largest lender of Paycheck Protection Program loans, which were the first lifeline thrown to suffering small businesses in the beginning of the pandemic.
September 8, 2020 – CNN (full article)
“JPMorgan investigates employees over potential misuse of PPP loans”
Wait…re-ride on the JP Morgan express:
September 21, 2020 – The Street.com (full article)
“JPMorgan and Deutsche Bank Named in Money Laundering Report”
Wait…another round of JP:
September 23, 2020 – The Wall Street Journal (full article)
“JPMorgan Nears Deal to Pay About $1 Billion to Settle Spoofing Probes”
Wells Fargo – As if Wells Fargo had much further to fall, here is their latest headline involving racist remarks from their CEO.
September 23, 2020 – Washington Post – (full article)
“Wells Fargo CEO apologizes after blaming shortage of Black talent for bank’s lack of diversity”
This crime is a little older, but the point still rings true:
February 21, 2020 – The New York Times (full article)
“The Price of Wells Fargo’s Fake Account Scandal Grows by $3 Billion”
As much as I would like to stuff my dollars under the ole queen size, these bank accounts are still the most reliable and secure option we have. At the end of the day, I could tolerate earning zero percent interest if I could have confidence that my money was being held in a place with even an ounce of integrity. Unlike Mary Poppins, today’s banking system is perfectly imperfect in every way.
Happy Friday! Stay healthy and please be safe!