Streams

What's Inside America's Banks

Thursday, January 03, 2013

More than four years after the 2008 financial crisis, public trust in banks is as low as ever. Sophisticated investors describe big banks as “black boxes” that may still be concealing enormous risks— the sort that could again take down the economy. Jesse Eisinger's investigation, written with Frank Partnoy, is called  “What’s Inside America’s Banks” and appears in the January/February issue of The Atlantic.

 

 

Guests:

Jesse Eisinger

Comments [7]

We had a crisis. Congress did nothing. They made things worse. Obama did nothing. He made things worse. What possible reason could we have to think that another crisis would change anything?

Jan. 03 2013 12:40 PM
Jim

"Regluators are struggling" with money laundering? Please. They enable it. $2B fine for funding terrorism but no criminal penalty or loss of charter? Well, then terrorism is now funding bank regulation.

Jan. 03 2013 12:39 PM
jgarbuz from Queens

Look, Jesus tried to regulate the moneylenders around the Temple Mount and look what happened to him! :)
Remeber the Golden Rule: He who has the Gold makes the Rules.

Jan. 03 2013 12:38 PM
MichaelB from Morningside Heights

The guest explains in a straight-forward manner all of what seems like the obvious flaws in our system, and how & why human nature will take advantage of them, to THEIR individual benefits, and to the disadvantage to every one else.

It just ain't that complicated! And the failure of our government to address these obvious flaws is unforgivable.

Jan. 03 2013 12:37 PM

The academics I have heard speak on Dodd-Frank say the entire legislation is a joke — thick with loopholes, subject to lobbying regarding implementation and enforcement. We now have six or seven federal agencies that are charged with oversight of the financial industry. Each of these agencies is subject to lobbying, congressional and presidential interference. Worse, the agencies can step on each other's toes. Financial firms can shop for whichever agency is most likely to act favorably toward the firm. And on and on.

Jan. 03 2013 12:28 PM
Joseph Cavalieri from east village

how about Credit Unions? I switch my accounts to a local credit union here in the east village 2 years age, as a personal protest to big banks. Any things covered with these smaller banks in Jesse's investigation?

thanks

Jan. 03 2013 12:24 PM

Example of why we have no trust in banks:

Many banks urge us to go paperless because it is more efficient, more environmentally friendly, and more cost-effective. My bank charges $20 for each wire transfer into my account. That is, if I deposit a paper check, there is no fee. If that same amount is wired in by the same party, then there is a $20 fee — despite all the claims promoting paperless transactions. I could describe half a dozen other ways all of the banks I have had accounts with in the past 10 years (probably three banks, not a great sample, true) have done similar things.

So many fees that even if interest rates were ten times what they are now, we would still lose money in the trade-off between fees and interest. Of course, if a person has enough money to enjoy 'private banking,' all of this changes.

Jan. 03 2013 11:54 AM

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