Freddie & Fannie bailout details

[SirNitram]

Proxy-Treasury lending. The entire financial system is now on a breathing tube, and it looks like if it wasn't there, it'd die.

I will make an attempt to explain what the hell I mean and how I came up with my deranged theory. Shoot down as you wish.

Banks aren't lending to one another. Banks aren't lending to customers. Banks are, in short, not lending. This, in previous years, would mean banks also aren't borrowing, But Paulson's opened a spigot in his house, and now through Freddie and Fannie: They'll capitalize anyone and try and absorb the losses into the federal deficit.

Let's examine. The Fed Discount Rate is around 1.75 right now. As of Sept 30th, the equivalent value for lending between banks(LIBOR, right?) was 6.88. What this means is simple: It costs a ton more to borrow from a bank than the Fed.

I'm not sure, in retrospect, any of this was supposed to do to correct this. Maybe a violent shock to the system, it was thought, would get people back to normal. But if the difference between begging the Fed and begging your fellow(Potentially shitbag-holding) banks for cash remains so high, the modern fiscal system is over. I have no idea what a system revolving around the State as the prime issuer of credit might look like. It's probably not pretty.

[Uraniun235]

If banks aren't lending to anyone, what the hell are they doing these days?

[aerius]

Clearing checques & payrolls, leaching off the government, and charging you a crapload of user fees.

[Darth Nostril]

Also shit like increasing the time it takes to transfer money from your account to anywhere else.
For example we get paid weekly, the money gets transferred straight out of the company account on Friday afternoon. It doesn't show up in my account until late Tuesday, for that period of time it's sat in the banks account earning interest for the bank.
Also paying off credit cards, I go to the website, enter the amount I wish to transfer, click the make payment button and it takes four working days to actually transfer. It used to take two days.
In short screwing their customers over, making it harder and more time consuming for us to get to our money, all the while the dickheads at the top were throwing money around with gay abandon because they didn't have a clue what they were fucking doing.

[Uraniun235]

Clearing checques & payrolls, leaching off the government, and charging you a crapload of user fees.

I don't incur any user fees, though it astonishes me that one of my friends has overdrawn his account several times.

For example we get paid weekly, the money gets transferred straight out of the company account on Friday afternoon. It doesn't show up in my account until late Tuesday, for that period of time it's sat in the banks account earning interest for the bank.

Your bank sucks. My money shows up the day they hand out the direct deposit stubs.

[Broomstick]

I have to agree - back when I had direct deposit the money showed up the same day, despite crossing a state line to get to my bank.

[Mr Bean]

Overdraft fee's? Don't talk to me about fucking overdraft fee's, fucking racketeering is what it is.

Example, a I have a secondary checking account/debit card which I use for small ticket purchases, I generally keep about 250$ in there and refill it as necessary. Well between work assignments last week I need two hundred out of there to cover my rent this month, normal I only use it to cover small purchases(Gum, sodas, snacks, a few drinks whatever) and also as mugging defense because if my wallet is taken, they get my license(I don't carry cash on my person anymore) a few reward style cards(Shopping center stuff, Boarders, ect) and at most 250$ on a card they can't use without my pin.

Well come two weeks ago I'm thirsty, according to a quick ATM check I still have 3$ in there so I buy a coke, and a sunday newspaper that day and stick the receipt in my pocket. Later that night driving home from work I forget about the coke and the paper(Like an idiot) and stop by a gas station and buy one of those horribly overpriced containers of orange juice. The charge goes through, the total puts me into overdraft(Debit card) by 36 cents.

A week later I go to deposit a check with current work and lo and behold I'm told by the nice man at the bank that my account is negative by 83 dollars.

Eighty three FUCKING DOLLARS
So I ask and it turns out my bank charges a flat fee of 35$ if you overdraft your account and then 12$ a day until you make the account positive again. Let me put that in prospective for my brief second here. In exchange for covering my small .36 cent overage charge(Which the bank had to "loan" me for those four days) they charged me a 23,000% percent interest rate. Come the fuck on! The 35$ fee was bad enough, were are already talking several thousand percent but the 12$ a day? What the fuck is this shit? Thank you fucking Bush 1 and Clinton for deregulation the fee banks can charge, now my bank can legally f@#$ me up, and I have no recourse except not to do business with them except.. oh wait the bank down the street charges even WORSE fee's than mine.