I wanted to write a piece on this based on my great experience with a small local bank (Virginia Heritage Bank) for our current mortgage loan. I'm happy to report that the Washington Post has done it for me.
Three cheers for the little guys:
"Banks throughout the United States carried on with the business of making loans yesterday even as federal officials warned again that their industry is on the verge of collapse, suggesting that the overheated language on Capitol Hill may not reflect the reality on many Main Streets.
The industry is resilient despite the struggles of some members. Washington Mutual, a troubled Seattle savings and loan that was among the nation's largest mortgage lenders, yesterday was seized by the government and sold to J.P. Morgan Chase.
At the same time, many smaller banks said they were actually benefiting from the problems on Wall Street. Deposits are flowing in as customers flee riskier investments, and well-qualified borrowers are lining up for loans.
'We collect money from local savers, and we lend it in the local community,' said William Dunkelberg, chairman of Liberty Bell Bank in Cherry Hill, N.J. 'We're doing fine. There are 9,000 financial institutions out there, and most of them are small and most of them are doing fine.'"
11 comments:
Great point
"At the same time, many smaller banks said they were actually benefiting from the problems on Wall Street."
If it's a mainstreet problem (which it's not) then give the money directly to mainstreet.
Why does the money have to go through Wall street first.
Burke and Herbert Bank and Trust in Alexandria. I have banked there for over 20 years because their customer service is superior. Even kept my bank account there when I lived in Maryland-never wanted to deal with the big banks.
"Burke and Herbert Bank and Trust in Alexandria. I have banked there for over 20 years because their customer service is superior. Even kept my bank account there when I lived in Maryland-never wanted to deal with the big banks."
They are a great one Bay 400. Theyve been around forever. I searched land records (when I bought) and out they had a mortgage on my house in 1857 - for $610 dollars!
A buddy of mine at GMU was peeved last year when they switched the bank franchise in the student union from United to Chevy Chase. After all, the reason that he, and many others, banked at United is that they had a convenient branch on campus. He looked into switching to Chevy Chase, but their ratings on bankrate.com were looking like garbage (2/5 stars), and United's safety rating was 4/5 stars.
So, when I decided to split my money among different banks, I chose United to be my local bank (the others being USAA and ING).
Here is a list of local and national banks, along with their star ratings from bankrate.com. 5/5 is best. The first group is 'local' -- although in several instances they are headquartered in another state (WV, NY, etc.).
4 Cardinal
4 United
4 M&T
4 Commerce
2 Chevy Chase
Larger national and regional banks:
4 USAA
3 ING
3 Fifth-Third
3 Bank of America
3 SunTrust
3 BB&T
3 PNC
2 National City
2 HSBC
1 Washington Mutual
1 Wachovia
@tom
"Why does the money have to go through Wall street first."
It's called reflation. The inverse pyramiding inflation scam works best when it starts at the top and works its way down. We just had 7 years of massive inflation (money supply inflation). Over the past 6-12 months it has slowed significantly. The scam works by taking Fed Reserve "reserves" (read actual paper) and lending out more than the reserves to their member banks (read big banks). These then take the money they have been lent and count that as their "reserves" and lend out more than their "reserve". A pyramiding scheme of inflating money supply.
This is why they can't just pass a 700B bailout of main street. That 700B bailout wouldn't get inflated more than once. Give 700B to banks, and soon that 700B becomes
3.199T (yes 3.199T).
The ramifications of this bailout are huge.
See:
http://en.wikipedia.org/wiki/Fractional-reserve_banking
contrarian: that list is interesting, as it's ordering (United [VA or WV] vs. Chevy Chase) is different compared to bankrate.com and bauer financial(?), which put Chevy Chase as much, much, worse.
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