When Banks Were REALLY Banks In my opinion do you know who I think caused the banking crisis in America? The banks did. It used to be that banks were solid local institutions like these, the Central Bank and Trust and the Great Northern Savings and Loan. When you went into these banks your money just felt safe. There was an armed guard and you could see the vault. When I was a kid banks were over regulated but by the 1990s a lot of those regulations had fallen away. Now banks could sell your mortgage to other banks. When I was a kid you knew your banker. He lived in your neighborhood and maybe he coached your little league team. He was part of the Barberton community. Then greed kicked in. Banks wanted to be able to sell your mortgage and suddenly you were sending your money to Gunslinger Savings and Loan in Dallas, Texas. Suddenly it seemed if they didnt care, then why should you care about making every payment on time. Then there was the problem of not enough collateral to back up your loan. Local bankers made good, local decisions. Now people were getting loans for houses that should not have. Air was being blown into the balloon at an alarming rate. When my aunt died we sold her house for an obscene amount of money on Washington St. This was bad enough but then the new owners must have borrowed $60,000 for a remudling. When I came back a year later I couldnt get over how much work had been done to the house to turn it into a McMansion. When I drove by 6 months later the house was vacant and being set to be demolished by the City. Evidently the mortgage must have been under water and the new owners, who probably had very little of their own equity in the house, just walked away. So, who do I blame? The banks, the bankers, and pure greed. Frank Jr.
Posted on: Mon, 18 Aug 2014 20:42:50 +0000
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