SWF seeks good bank, must not have sub-prime loans

Or
Trickle down economic collapse

Well, I’m sure everyone has heard by now that Washington Mutual, a.k.a. Wamu, is defunct. If you haven’t heard (I don’t know which hole in the ground you’ve been sticking your head in) J.P. Morgan Chase bought up what remained of Wamu, with the help of the FDIC.

I could say many things about the collapse on Wall Street, including this is what no oversight or effective regulation will get you, and they’re greedy little bastards up there at the top, maybe it’s about time they had some sort of reality check. As for the $700 billion bailout, why don’t we spend it on making sure the base is solid? FDR and his advisors had a pretty good idea of how to handle this sort of situation. Make sure that the people at the bottom are taken care of and have a little extra money to spend and then you get trickle up economics. So far I have seen no evidence that trickle down economics is effective. Bailing out Wall Street isn’t going to help reduce the unemployment rate in the next month or is it going to get people who have lost their homes back into a stable position. I’m glad that the congress did not approve the bailout. Most of it would have ended up in the pockets of CEOs anyway. I’m glad that congress realizes that there need to be some restrictions and regulations to go along with that sort of bailout, but I am disappointed that there has not been a movement to reinstate the sort of regulations we used to have to prevent this sort of situation in the first place.

Deregulation has been the name of the game since Regan went wild with it in the 80s. In the name of a free market, and with a laissez-faire attitude the US government went about removing things such as Glass-Steagall Act of 1933. This gave free reign for the banks and other large corporations to do what ever the **** they wanted. But the idea (allegedly) was that the market would regulate itself and everything would work out okay. I’ve always thought that was a fine idea, as long as there were no people involved, ‘cause you know, people tend to get greedy. Well, the same people who were on this deregulation and free market kick, suddenly are all for government intervention. Well, government intervention in the form of corporate welfare: it’s fine if the regulation stays gone. It’s very hypocritical and not enough people are calling them on it. If its free markets everyone wants then fine, let there be free markets and see what happens. Let the companies collapse, let them consolidate into monopolies, let them speculate and artificially raise prices. Don’t do anything to or for them, including bailouts out or FDIC brokered buyouts (the Indymac deal cost the FDIC a lot of money). I don’t think it’s going to look pretty for most of us.

Back to Wamu: my real disappointment in this situation is that I didn’t get around to writing about my horrible experience with Wamu over the past weeks before this all happened. It doesn’t have quite the same vindictive flavor or sense of warning as it would have early last week. I would hope for the newly assigned J.P. Morgan Chase customers, that Chase does not do business the same way as Wamu. But as long as banks can do as they please, who knows.

Anyway, since I no longer am no longer vengeful, I will make this short(er). A couple of weeks ago I deposited two checks. One from my insurance company, a reputable company, and my payroll check, which I have deposited on a regular basis for quite some time. I was given a receipt from the teller that showed that the money was in my account. Everything appeared to be in order. I went out and spent the insurance check, which I was waiting on for a particular purpose. Everything was still fine. I still had plenty of money in the bank according to my online bank statement. Two days went by and I went to a drugstore to get just a few small things and found that my bankcard was rejected. I went home and checked my online statement again and I had a -$1700 available balance! I had no idea what was going on, because the running total showed that I should still have plenty of money left in my account. The checks were listed there as deposited and their amounts credited towards the running total. So I went into the bank to find out what had happened. The lady who I ended up talking to told me all kinds of ridiculous things. First, my account was to new so they had to hold my checks. This was untrue. My account had been open for well over the thirty-day new account period when you have to wait a few days before checks show up in your account. And if this had been the case they would have been on hold immediately not a couple of days after already being in my account. I asked if this was the case then how come the tellers never said anything to me when I made my deposit, and why did I not find out anything about this until I came into the bank. Then I was told that they couldn’t verify whether or not the checks were good. The reason being that my payroll check was hand written. BS. My last five payroll checks have been hand written and were deposited without a problem. The woman told me that I had to get letters from the other banks to prove that the other checks were good. I actually at one point went to one of the other banks, which happened to be across the street. They told me that they don’t do that, ever. When I went back to Wamu, the woman told me there was nothing she could do. I’ll admit I was upset. I actually started crying earlier, when she told me that I wouldn’t have any money for a week. The woman was so patronizing about it too, which made me even more upset. She started saying every time she got someone new on the phone from the main office, “we have a problem situation here.” I was already stressed out, and then to find out I couldn’t buy groceries or gas to get to work for a week, yeah I was upset. But when became apparent that they were just ****ing with me, and that nothing was going to get fixed unless a made a bigger fuss, I did. I yelled. I think I actually told other bank customers to get out while they could. This whole time I kept trying to call my payroll person and my insurance claim person. It turned out that the insurance person was gone for the day, so no help there. The woman finally asked me to leave, if I was going to yell. She threatened to call security on me. So I left. At this point I finally get a hold of my payroll person who tells me that no one ever tried to reach her to find out if the check was good. She says that it very strange that they would be doing this. Usually, she says, the bank just calls her up if they have a question about a check and she verifies it end of story. She said that usually the employee never even hears about it. So I go back into the bank with her on the phone and try to hand her over to the woman to verify at least that check. She won’t at first, but I insist and finally she takes the phone and talk to my payroll person, but only gets her phone number to give to the main people. So I sit there and wait at this woman’s desk, trying to get her to do something about this. After awhile I get a call from my payroll person wanting to know what happening because she is still waiting for a call from the bank. At this point I get really upset. I start asking this woman if she is planning on buying me dinner. When she says no, I tell her that she better fix things so I can eat. I start to raise my voice again, and she says that she will see what she can do, just don’t scream in the bank. I tell her, “Don’t screw me and I won’t scream.” I also made her promise that I wasn’t going to get any over draft fees, which is what I’m sure they were counting on. How many people get screwed this way and don’t do anything about it and then end up owing the bank a couple hundreds of dollars because they got screwed. Also earlier, this important later in the story, I told her I was waiting for my rent check to go through and it shouldn’t be bounced because I technically do have the money to cover it in my account. And she told me that it was fine, there was no record of the check coming in yet. So, gets on the phone and while she is on hold, we have a few minute a stare down with her saying don’t scream, and me saying I won’t if you don’t screw me. I said it in a very nice voice. She talks to someone on the phone for a minute and she turns to me and says it’s fixed. Magically all the reasons and things I was supposed to do went away. I thanked her, wished her a better day, went home and immediately printed out a statement that showed the money in my account and the available balance matching the running total.

So a week goes by and everything appears to be fine. I am at this point contemplating getting a new bank account, but I am waiting for my rent check to clear. When I check my mail, I find a letter from Wamu, dated the same day that I was in the bank, that my rent check was bounced. I go into my rental agency the next morning and they don’t know anything about it yet, so I figure it might be a mistake, since the oh so nice woman at the bank told me that it would be fine. So I go home and to take a look at my online balance to see whether or not the check had actually gone through. But I can’t log on. So I go down to a Wamu bank to see if I can check my balance at an ATM, but all it does is spit my ATM card back out at me. I go into the bank to talk to someone to find out what is happening. The young man I ended up speaking with was very nice, but he had no idea what was going on. So he calls the main office and talks to them for just and minute and then hands me the phone saying they want to talk to me. The woman on the phone says to me in a very snotty voice, “we no longer want to do business with you.” She told me that my account had been stopped two days earlier, and that the man I was with at the bank would give me all my funds. When I asked her why all she would say was, “we no longer want to business with you, “ in a very hostile voice. I also asked her why this was the first time I was hearing about this, to which she gave me the same answer. When I asked her if it was because of the other woman I dealt with previously, and tried to explain to her what happened, during which I used the word bullshit to describe the things the other woman said I had to do, she snapped at me and said, “don’t use that language with me.” I apologized and told her I was just trying to explain the story and not trying to be rude to her. I just thought they should look into how this other woman was treating customers, and work on communication with customers so that they have time to deal with things. Otherwise you are going to have a lot of unhappy customers. Again she replied, ‘we no longer wish to do business with you.”

Three days later I received another letter from Wamu. This time it told me that as of September 26 my accounts would be closed, no reason included. This date, by the way, is two business weeks after they actually shut down my accounts.

What did I learn from this experience? If you aren’t submissive and take it up the rear, they don’t want you. Actually, what I suspected at the time was that they new they were going under and were making a last ditch effort to gain funds through creating situations where they could rack up overdraft fees. I heard somewhere, though I can’t verify it, that banks make around 35% of their revenue from fees.

As for what this has to do with bailouts and economic collapse, I think it is our governments job to make sure everything is running properly and that its citizen are being taken care of and not taken advantage of. Its job is not to pay off those who screwing it all up. By the way, the people responsible are doing just fine, and are already walking away with billions.