Article Score0

No new home construction, very few mortgage loans, but new banks are going up everywhere.
Thanks everybody. I actually understand all this, what I do not understand is WHY SO MANY? Do we really need five banks on one city block, another branch of the same opening but half a mile away? It seems irresponsible to me.

3 Thoughts on If the economy is so bad, then why are they constantly building new banks?
  1. Reply
    rsarah23
    January 23, 2013 at 9:23 pm

    Everybody needs a bank. Banks aren’t the kind of businesses that are so affected by economic conditions.

  2. Reply
    robert w
    January 23, 2013 at 9:52 pm

    u and debtors are paying for them.

  3. Reply
    reliefaswas
    January 23, 2013 at 10:51 pm

    The flow of goods and services and the monetary exchange that is reflective of this is doing more to change the world than anything ever in the whole of history. Political boundaries, religious idealology, cultural distinctions, political thought…All are influenced by the control of money, but money is the means not the end. It is a mere reflection of the thoughts and intents of the human heart…individually and collectively. If you look into the use of allowing credit and the results “of” its use you will find that it has enabled the “present” to live in the “future”. We may have now, what would have had to be in the future…..But this has come with a price.the future is not here yet as far as the reality of paying for it. We will see the further institution of a credit and cashless society, all will eventually revolve around a system that is largely based upon a common trust in something intangible. Or perhaps it would be better said not understood. The debt from loans is used to create “money”…it is regarded as an asset and recirculated into the system as if it does actually exist in the here and now. (which it doesn`t yet, because debt is a promise of future existence (as it is repayed) The banks have used the promise as collatreral to borrow more money. What they have loaned out is now ascertained to be an asset worthy of being considered as collateral. (But remember it does not exist yet, it is only the promise of a future event) Of all the loans that were given in the past many have defaulted…thereby eliminating the percieved collateral and future payment. The banks have suffered a loss that needs to be recovered that they may maintain a certain degree of solvency. The Fed has dropped rates, but this is not being allowed to go through…yet. Imagine a dam (banks) blocking a river…the gates are opened (loans & mortgs.) with the understanding that the winters snows (repaymant) will refill the resivoir….it doesn`t snow as much that year (defaults) and they close the gates (tighter loan criteria) until the water ($ ) is back to an acceptable level. There is a re-arranging of the board so to speak…We are so used to this chain of events that we will not go back to living in the present and indeed cannot. Saving money, thrift, conservatism in finances, living within ones means…all are foreign to todays society. And we will be subject to the systems inherant weaknesses. Hey, theworld is trying something that has never been done before. There is no path to follow. A new system is being pioneered and it seems few are inclined to make the effort to understand it. And there is quite a bit more to understand, so much so that those who deal daily with it are at a loss to explain its intricacies…hence a hesitancy to always forge ahead into the unknown by loosening up loans again. But eventually they must and there will be new institutions of lending to once again open the gates…..(in theory, if nothing else goes wrong) An awfully fragile house of cards staying erect only by the faith of the builders…and those who borrow…

    Leave a reply

    Register New Account
    Reset Password