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Glenn Beck


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Absolutely the big banks are. Local banks are also down, but not like the big banks are. The little ones did not loose any money to speak of like the bail out gamblers!

 

Peace and Blessings

 

Check your facts Mac, the FDIC has closed more small banks in the last 9 months than at any time since the S&L crisis of the mid '80s. The reasons are not coincidentally, much the same as then, a real estate bubble based on inflated values and a large pool of money looking for what was thought of as a safe investment in real estate. Then as now, there was also a fair amount of fraud in the banking industry and lax regulation. Twenty years later, we've learned nothing.

Edited by Mark B. Morrow
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One reason I'm not much bullish on residential real estate is because most figure if you just wait a while, it will come bouncing back to 2004-2005 highs. Since that is a popular view....I'm not so sure. Who will buy that house?

 

I will state that I am in the medical profession and therefore will not try to pass myself as an experienced stock market customer. So my comment should be weighed as such:

 

I think the housing market will eventually rise again because you do not have the same customers. College graduates and those advancing in their careers will become brand new customers.

 

My irritation comes from investors buying second & 3rd homes cranking up the prices. Those rented properties are harbingers of devaluation if the percentage is too high.

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Everyone lost money. Larger banks just had more to lose.

 

On another note, I've been waiting this entire time for someone to point out that I spelt Glenn's name wrong. I guess Nick was the only one :shades:

 

Small banks did not do the housing scandal. As small banks, there were much more concerned about being conservative. They were not chasing stock prices like BofA, City, Wells, etc.

 

So they were impacted very limitedly from everything I have read. They had locals on their boards and such to keep them from engaging in much of that junk.

 

Peace and Blessings

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Check your facts Mac, the FDIC has closed more small banks in the last 9 months than at any time since the S&L crisis of the mid '80s. The reasons are not coincidentally, much the same as then, a real estate bubble based on inflated values and a large pool of money looking for what was thought of as a safe investment in real estate. Then as now, there was also a fair amount of fraud in the banking industry and lax regulation. Twenty years later, we've learned nothing.

 

I have, months ago. And it stands pretty solid on what banks are failing.

 

 

Bank Failures by Decade

 

* 2000-2007: 32

* 1990-1999: 925

* 1980-1989: 2,036

* 1970-1979: 79

* 1960-1969: 44

* 1950-1959: 28

* 1940-1949: 99

* 1934-1939: 312

 

2000-2008: 45

 

5 bank failures bring '09 tally to 89

 

Most all bank failures 08 to 09 have been big gambling institutions. Not small town several branch banks.

 

Banks v/s big banking institutions. There is a monolithic difference as I see it.

 

How Bad Are These Bank Failures?

 

I am not saying no small banks have failed. But certainly as a % of assets, the big banks sucked up the FDIC funds.

 

Peace and Blessings

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My father works at the upper echelon of a financial institution that handles 40% of all electronic funds transactions in the country. He told me so. The catch22 is that banks are actually lending less than they were 6 months ago.

What are the reasons?

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With all this talk of the financial sector, I think the manufacturing sector is being ignored.

 

Case in point, the largest cement production facility in the U.S. is right now sitting idle. Others, are already idle or are on a weeks-on/weeks-off schedule (a very expensive thing to do at a cement kiln). In the last 9 months, 8 facilities (that I know of) have either been mothballed or closed entirely. That is not to say they are producing nothing, but you'd think that with all this "stimulus" spending for infrastructure there'd be something going on. (Ironically, that new EPA greenhouse gas rule will hit these guys the most; talk about kicking them when they're down.) A couple of facilities I know of have actually seen orders go up, but they are exporting.

 

I'll have a bit more confidence in the U.S. economy when I see production (in general) go up.

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With all this talk of the financial sector, I think the manufacturing sector is being ignored.

 

Case in point, the largest cement production facility in the U.S. is right now sitting idle. Others, are already idle or are on a weeks-on/weeks-off schedule (a very expensive thing to do at a cement kiln). In the last 9 months, 8 facilities (that I know of) have either been mothballed or closed entirely. That is not to say they are producing nothing, but you'd think that with all this "stimulus" spending for infrastructure there'd be something going on. (Ironically, that new EPA greenhouse gas rule will hit these guys the most; talk about kicking them when they're down.) A couple of facilities I know of have actually seen orders go up, but they are exporting.

 

I'll have a bit more confidence in the U.S. economy when I see production (in general) go up.

 

I agree. And this is where I think the best opportunity for stock market gains are. In the unloved, sometimes dirty, basic industrial, manufacturing, chemical, and building block stocks. Manufacturing companies (people that make things like Ford and Caterpillar), and the basic industries that supply them (Dupont, Dow, specialty steel, alcoa aluminum, etc), have been out of favor for the past several business cycles. And there are many others.

Edited by Ralph Greene
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I disagree. Saying we are in better shape based upon what? People buying a new JD mower for $7k and a new couch and sofa for $4k both on 12 months no payments no interest and then a new car via C4C? Debt spending to get now and deal with the pain later. It is all about robbing Peter to pay Paul.

 

Peace and Blessings

 

Well, one of the more encouraging things I've seen over the past several months is that personal debt levels have dropped. Not a whole lot, but they have gone down. So it seems at least a few people have wised up and are avoiding the scenario you described.

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What are the reasons?
Commerce is recovering almost across the board. It would appear that the illusion that things are getting better has actually caused penny pinching consumers to start spending money again. Businesses that were liquidating assets before, are once again investing... but out of pocket. Banks aren't lending because they simply want to fill their coffers with real money from withstanding loans instead of artificially filling their coffers with speculated investments.

 

As far as manufacturing jobs go, they're not coming back... or at least not in the same sectors. Our economy has been forced to move even further into services, as projected higher taxes on business and increased energy costs are forcing the manufacturing sector to move out of the country. Services only stay here because of proximity.

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