America will soon see a wave of bank mergers? • Hacker News Board

Re: America will soon see a wave of bank mergers?

#311

Post by HWR_14 » Tue, May 02, 2023, 9:20 PM UTC

frankfrankfrank wrote: post #12

lmpdev wrote: post #3

I know there are regulatory rules which partially explain the fragmented banking sector in the US compared to other nations: four example in Australia we only really have 4-5 proper banks Are there other reasons that small banks have seemed to thrive in the United States but no where else?

I would say the fact that banking is not something that is legally the authority of the federal government; even though states have seemingly acquiesced to their role and right eroding and being taken from them as the federal government persistently oversteps its bound and becomes ever more authoritarian. It’s something even most Americans don’t even understand anymore, let alone foreigners or immigrants; that the US…

For checks to work, banks need to cooperate in interstate check clearing houses, which brings them well within "interstate commerce". This is one of many examples.

But, IIRC, you can set up a bank absent checking services, wires, FDIC protection, etc. and operate entirely within one state. Good luck attracting customers.

Re: America will soon see a wave of bank mergers?

#312

Post by carlosjobim » Tue, May 02, 2023, 9:22 PM UTC

Invictus0 wrote: post #106

runnerup wrote: post #101

Earlier quoted context omitted.

People aren’t demanding deposit accounts that pay interest. The banks with the most deposits are providing 0.01% interest. People are still sticking their money there more than they put in banks which are offering >3% APR.

That's because high yield bank accounts are a phenomenon of the last 6 months and retail by and large hasn't got the message yet. 0.01 is not likely to last forever, and the TBTF banks are losing deposits.

High yield bank accounts was also something that suddenly appeared before the 2008 financial melt down. Now that they are appearing again I can be completely confident that we will see a huge economic depression. All man made of course - this could go away if it wasn't for the evil side of human nature.

Re: America will soon see a wave of bank mergers?

#313

Post by mauvehaus » Tue, May 02, 2023, 9:22 PM UTC

nitwit005 wrote: post #245

inconceivable wrote: post #117

Earlier quoted context omitted.

never buy a mortgage through an app. use a human broker or if you're rich enough, a bank salesman. and for those of you who refuse to talk to people when spending multiple hundreds of thousands or even millions of dollars, well... this is what you get to deal with.

The human will type your information into the same system.

The human can likely also pick up the phone and talk to another human if the system is spitting back something obviously stupid. You don't need the human for the typical case; you need the human for the atypical case.

Re: America will soon see a wave of bank mergers?

#314

Post by ericpauley » Tue, May 02, 2023, 9:23 PM UTC

stanleydrew wrote: post #291

ericpauley wrote: post #268

Earlier quoted context omitted.

If the loan % is lower than a savings account then there is no/0/zero risk, so long as you stay under FDIC limits. Your deposit earns money and is backed by the full faith and credit of the United States government .

The loan will usually be at a fixed-rate, while the interest paid on your deposits will fluctuate. So there is still risk that your net interest margin will go negative at some point.

Get a CD or buy treasuries with a matched maturity date. Or if you don’t want that and the savings rate goes below you can pay off any time (check your terms).

Re: America will soon see a wave of bank mergers?

#315

Post by l3mure » Tue, May 02, 2023, 9:23 PM UTC

wesapien wrote: post #278

l3mure wrote: post #233

Earlier quoted context omitted.

Race is the modality by which class is primarily expressed in America. There is no way to resolve socioeconomic problems without dealing with race at the same time, clearly demonstrated multiple times in US history. The failure of Reconstruction -- an "Unfinished Revolution" as Eric Foner puts it -- was precisely white workers' rejection of class solidarity with Black workers in favor of post-war white racial reconci…

Crab mentality and revenge seeking will keep people from true progress. We need to crush the idea of victim hood as a privilege.

> We need to crush the idea of victim hood as a privilege.

"Victim hood as privilege" is a right-wing strawman of the idea of intersectionality. You're suggesting throwing a punch at an obvious feint.

Intersectionality is simply the idea that certain groups experience unique configurations of more general problems, and that counteracting those configurations contributes to resolving the general case.

Do you think a coal miner with black lung who organizes for compensation on that basis is claiming "victim hood as privilege"? I hope not. It should also be clear that coal miners organizing for their own workplace safety helps ALL workers. That's why OSHA exists after all.

The same applies to racial issues.

Re: America will soon see a wave of bank mergers?

#316

Post by chickenpotpie » Tue, May 02, 2023, 9:24 PM UTC

nicholasjarnold wrote: post #295

tester756 wrote: post #114

Earlier quoted context omitted.

Is this why some people recommend to take loan for something that you have money? Like - you wanna spend 30K on a car and you have it in cash? take loan you'll lose a some $$, but you'll be building your history.

Reasons other than "it helps me build a credit history": * you think you can make more money by investing your 30k and letting it grow and compound * you are very prudent with your cash on hand and would rather have immediate access to liquid cash than save a little bit on interest which you pay down over the course of Some of the dynamics here are a bit different when market returns are not looking great/steady and…

> you think you can make more money by investing your 30k and letting it grow and compound

Mortgages especially. Mortgage interest is tax deductible and makes it easier for high tax bracket individuals to outperform their loan by investing.

Re: America will soon see a wave of bank mergers?

#317

Post by HWR_14 » Tue, May 02, 2023, 9:27 PM UTC

Mistletoe wrote: post #4

cyclecount wrote: post #2

All of the rules put in place after 2008 are being ignored; the number of banks in the US pre-2008 financial crisis was about 31k. Now there are close to 3000. After this wave of mergers, there might be around 1000! And a few will be so large that they can make insane bets, betting on risky and novel new investment vehicles that will (maybe initially) pay off handsomely before ultimately failing dramatically. This wi…

Am I too tinfoil hat to think the big 4 planned it like this all along? I guess one could ask why WOULDN’T they have meetings trying to engineer exactly what is happening?

I think you are too tinfoil hat to think they planned it. They don't need to engineer what is happening, it was obviously going to happen at some point. They could have targeted some banks (active, hard), or they simply could have realized that a percentage would fail when rates went up, so they got in a position to do well picking up the pieces. And then they acquire whatever fails.

Re: America will soon see a wave of bank mergers?

#318

Post by HWR_14 » Tue, May 02, 2023, 9:28 PM UTC

mensetmanusman wrote: post #102

It’s funny how the laws related to fixing “too big to fail” just meant that small banks go away in practice.

Remember when SVB lobbied to not be hamstrung by the "too big to fail" fixing laws because they weren't that big?

Re: America will soon see a wave of bank mergers?

#319

Post by diordiderot » Tue, May 02, 2023, 9:31 PM UTC

fowtowmowcow wrote: post #292

danaris wrote: post #193

Earlier quoted context omitted.

The government would seem to have every recourse to collect.

Hard to collect money on unemployed and dead.

Your thinking is too fine grained. Missing forest through the trees.

For a nation state with it's own currency, money is the sum of the production capacity / natural resources of that nation state.

You don't need Joe and Sue to pay you back.

Re: America will soon see a wave of bank mergers?

#320

Post by technothrasher » Tue, May 02, 2023, 9:31 PM UTC

frankfrankfrank wrote: post #12

lmpdev wrote: post #3

I know there are regulatory rules which partially explain the fragmented banking sector in the US compared to other nations: four example in Australia we only really have 4-5 proper banks Are there other reasons that small banks have seemed to thrive in the United States but no where else?

I would say the fact that banking is not something that is legally the authority of the federal government; even though states have seemingly acquiesced to their role and right eroding and being taken from them as the federal government persistently oversteps its bound and becomes ever more authoritarian. It’s something even most Americans don’t even understand anymore, let alone foreigners or immigrants; that the US…

> the founders of America were not positively explicit enough about the sovereignty of the states

The sovereignty of the states drastically changed after the civil war and the reconstruction amendments.