Gas Prices, Bank Fees... Is the "fix" in?

Wifey was furious, but not at me!

Wifey arrived at the gym earlier today to bitch and complain about the price of gasoline. Not new a subject for these pages, but then the increases have never been so blatant. Just this morning gas at our neighborhood station was $4.03 a gallon. The morning news carried stories about Hurricane Isaac and how it will close the offshore drilling efforts for a few days. According to the news, this will result in a spike in prices of about $.25 to $.30 a gallon on a temporary basis.

According to those who believe in a market economy of supply and demand, these increases should take place in about two weeks from now when the factors governing the market will have had the opportunity to function and allow for the proper price adjustment.

Bull!

It’s gouge the consumer time thanks to the efforts of BP, Shell, Marathon, et al. The market function has not had the opportunity to alter the price of gasoline already in the ground. It’s just “screw the public, and make as much money as we can” that allows this to happen.

So when your friendly Conservative tells you we don’t need government oversight and regulation, tell them how much crap that is. Efficient government regulations could stop the gouging of America.

And not just with gasoline. As a former bank marketer, I believe more, not less regulation is needed in the industry where I spent my working career.

Isn’t it amazing when new government regulations designed to end the mistakes in mortgage lending all of a sudden make banks realize they need new fees to cover what they may be losing due to oversight?

Who pays?

You do!

With increased fees on everything.

Years ago, bankers determined they could save a fortune in wages and benefits if they were to automate some teller functions. This was the birth of the ATM (Automated Teller Machine). Banks saved money with fewer customer interactions. Ooops!

Apparently someone in Accounting realized ATMs cost money to operate and stock. This was the birth of the ATM fee; you know $3 a pop if you used someone else’s ATM. Boy, those electronic transfers really cost a ton! Don’t believe it. They cost less than pennies, if that.

Banks used to make a fortune in float. That cash cow has been pretty much eliminated with faster collection of funds and increased use of ACH and wire transfers. Still, banks report record profits.

Michael Lewis wrote a marvelous book called The Big Short, that covers the greed of bankers, explaining how banks created derivatives. These phony instruments combined pieces of good, bad and horrible mortgages into financial instruments that were traded like kids did with baseball cards.

Not surprisingly, there was gross greed, which resulted in the failure of Lehman Brothers, the near collapse of AIG, Merrill Lynch and Bank of America. The banker’s enemy: the government had to step in to save them. Yes, the government of George W. Bush came to the rescue of the global financial system with the excellent work of the Treasury Dept. and the Federal Reserve. Hank Paulson is especially to be congratulated.

So now, when you hear Republicans yell at government overregulation of the financial industry, tell them, it’s pure BS.

If you have the opportunity, watch “Too Big To Fail”. You’ll find it On Demand, Netflix or at your video store (remember them), or thru streaming video.

Now, Wifey feels better and so do I having that off my chest.

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