Americans Do Trust Their Biggest BanksVW Staff
Rafferty Capital Markets analyst Richard X. Bove pens a love letter to big banking, laying out the reasons why Americans should – and do – trust the Big 4.
Actions Speak Louder Than Words
The four biggest banks in this country are:
1. 99.5% owned directly or indirectly by the American people (insiders hold less than ½ of 1% of big bank stock).
2. In crisis, and certainly over the past 5 years, average Americans have poured trillions of dollars of their money into bank
deposits seeking safety not returns.
3. Americans trust the big banks to move quadrillions of dollars in payments from one place to another.
4. They borrow more trillions from these banks
5. They trust the big banks with their investment funds
Virtually every adult American has some dealing with the four biggest banks in this country. If as you say Americans do not trust the biggest banks, why would they place the big banks at the forefront of the nation’s financial system?
It is the effete media who see the Hudson River as the place where the world ends that is out of touch with America. Big banks are serving all Americans because all Americans trust these institutions.
Attacking these banks is supporting their competitors. It is anti-American and pro-China, Canada and every other country that is taking market share away from the U.S. banks. Five of the nine largest banks in North America are Canadian. The four biggest banks in China are all bigger than the biggest bank in the U.S. The biggest bank in China makes more money than the two biggest banks in the U.S. put together.”
The core point that I am trying to make to Bloomberg is that the actions of the American people every hour of every day demonstrate their trust in America’s biggest banks. Moreover, the American people own virtually 100% of the nation’s biggest banks.
• When you attack these banks you attack their owners, the American people.
• When one claims to have superior knowledge of how Americans feel about their banks it should be based on what Americans do not what journalists and politicians say.
We are in the midst of a new attack by the government and media against the banking system. The new Republican tax proposal is being positioned as: “If we can tax the big banks we can give the rest of America a tax break.” There is a renewed attack against the mortgage practices of the banking industry.
There is no understanding at all that taking funds away from banks is taking funds away from
Americans in two fashions:
• It harms the equity holdings of these people; and
• More importantly, it restricts the money available for loans and economic growth – it kills jobs.
It would be helpful if the policymakers in and out of government made an attempt to understand the system that they attack so gleefully. Plus, it would be helpful if they understood that attacking American banks is very helpful to those foreign banks that are gaining market share against the Americans. In my view whether these people know what they are doing or not their policies are anti-American finance and pro foreign control of the global financial system. This is not good for America or the Americans who own big banks.