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I'll be moving to Indy on Wednesday and I need a new bank. I currently use Bank of America, but there is none in Indy.
I decided to do some homework and make sure I locate a bank that is fairly safe (ie. one with decent liquidity, one that did not receive TARP money, and one that has minimal/no exposure to subprime or ARMs). I found a fantastic bank screener here: http://www.thestreet.com/tsc/ratings/screener.html
Here is the ratings list that was produced after I conducted my search. I'll most likely go with Hendricks County Bank & Trust (HCBT) or Citizens bank.. both have a B rating and they have multiple/convenient branch locations.
Here is the list (no links here). I hope you guys find it helpful:
In 2006 I graduated college with an Economics degree. After spending four years learning about the banking system; I switched to a credit union. I will never bank at a bank again. Probably the strongest effect my education had on me
Bank ratings services such as the one the OP mentions have limited utility in that they may or may not correlate at all with how the supervisory agencies view those institutions. The vast majority of consumers hold deposits under FDIC insurance limits. Therefore, their decision as to where to bank should be based on service and convenience, IMO.
It needs to be noted that many healthy banks accepted TARP funds at the urging of the Fed, so that's not necessarilty a good barometer of health. This has occurred for two reasons: 1) To minimize any stigma attached to accepting TARP funds, and 2) to provide healthy banks with capital to absorb unhealthy banks, thus minimizing the stress on the FDIC's Deposit Insurance Fund.
Secondly, most banks hold ARMs in their portfolios. They generally don't hold 30-year, fixed-rate mortgages because they're a poor asset-liability funding match. That's why Fannie and Freddie exist. So, havings ARMs on the books per se is not a good barometer of health either.
Bank ratings services such as the one the OP mentions have limited utility in that they may or may not correlate at all with how the supervisory agencies view those institutions. The vast majority of consumers hold deposits under FDIC insurance limits. Therefore, their decision as to where to bank should be based on service and convenience, IMO.
So these ratings mean nothing? If there were bank runs (electronic or physical), FDIC would not have enough money to cover all deposits... no matter how many fiatscos the Treasury prints for them. If the US dollar collapses, it really won't matter anyway because fiat paper won't be worth anything.
Quote:
Originally Posted by grmasterb
It needs to be noted that many healthy banks accepted TARP funds at the urging of the Fed, so that's not necessarilty a good barometer of health. This has occurred for two reasons: 1) To minimize any stigma attached to accepting TARP funds, and 2) to provide healthy banks with capital to absorb unhealthy banks, thus minimizing the stress on the FDIC's Deposit Insurance Fund.
Many yes, but not all. The Fed forced semi-healthy banks into shotgun marriages with unhealthy banks to calm the public in order to avoid bank runs. The FDIC raised the insurance limit from $100K to $250K for the same reason. There is no way the FDIC could return $250K to each depositor if bank runs were to occur.
BTW, we were very close to a total financial meltdown back in Sept of 2008. There was an electronic run on the banks, but the Fed came in with a stick save when they raised the FDIC to $250K per account.
Quote:
Originally Posted by grmasterb
Secondly, most banks hold ARMs in their portfolios. They generally don't hold 30-year, fixed-rate mortgages because they're a poor asset-liability funding match. That's why Fannie and Freddie exist. So, havings ARMs on the books per se is not a good barometer of health either.
I assume you meant: " not having ARM's on the books is not a good barometer of health"
These crappola mortgage products were packaged and sold by Goldman Sachs (ie. Hank Paulson). This toxic garbage was rated AAA, then sold to every Tom, Dick and Harry. This is precisely what took out AIG, Meryl Lynch, Bear Stearns, Citigroup, Washington Mutual and Wachovia. During that time, Goldman Sachs shorted their mortgage portfolio and made tons of money while banks, the housing market and economy were collapsing... nice huh? All this and Hank Paulson was elected US Treasury Secretary and was put in charge of fixing the very crisis that HE helped to create... talk about a conflict of interest!
Unfortunately, the commercial/retail RE market is the next thing to melt down. In fact, it's happening right now. Retail stores are going out of business left and right. With the economy tanking, who is going to fill all these vacant spaces?
I might have gone of track on some of this stuff... sorry about the rant.
So these ratings mean nothing? If there were bank runs (electronic or physical), FDIC would not have enough money to cover all deposits... no matter how many fiatscos the Treasury prints for them. If the US dollar collapses, it really won't matter anyway because fiat paper won't be worth anything.
Many yes, but not all. The Fed forced semi-healthy banks into shotgun marriages with unhealthy banks to calm the public in order to avoid bank runs. The FDIC raised the insurance limit from $100K to $250K for the same reason. There is no way the FDIC could return $250K to each depositor if bank runs were to occur.
BTW, we were very close to a total financial meltdown back in Sept of 2008. There was an electronic run on the banks, but the Fed came in with a stick save when they raised the FDIC to $250K per account.
I assume you meant: " not having ARM's on the books is not a good barometer of health"
These crappola mortgage products were packaged and sold by Goldman Sachs (ie. Hank Paulson). This toxic garbage was rated AAA, then sold to every Tom, Dick and Harry. This is precisely what took out AIG, Meryl Lynch, Bear Stearns, Citigroup, Washington Mutual and Wachovia. During that time, Goldman Sachs shorted their mortgage portfolio and made tons of money while banks, the housing market and economy were collapsing... nice huh? All this and Hank Paulson was elected US Treasury Secretary and was put in charge of fixing the very crisis that HE helped to create... talk about a conflict of interest!
Unfortunately, the commercial/retail RE market is the next thing to melt down. In fact, it's happening right now. Retail stores are going out of business left and right. With the economy tanking, who is going to fill all these vacant spaces?
I might have gone of track on some of this stuff... sorry about the rant.
You sound like a gold standard adherent, so I'm going to decline further discussion on much of this because we'd be at an impasse. Regarding ARMs, however, I think you're actually referring to nontraditional mortgage lending and not the standard 1/1, 3/1, 5/1 and 7/1 ARMs that have been on the market for years now.
One other thing....the Treasury secretary isn't an elected position.
You sound like a gold standard adherent, so I'm going to decline further discussion on much of this because we'd be at an impasse. Regarding ARMs, however, I think you're actually referring to nontraditional mortgage lending and not the standard 1/1, 3/1, 5/1 and 7/1 ARMs that have been on the market for years now.
One other thing....the Treasury secretary isn't an elected position.
Yes that's right... gold and silver is the only real money. Fiat currencies (backed by nothing) ultimately fail... history has proved this.
Sorry for the typo... I meant Paulson was "appointed", which is even worse that being elected because the American sheeple have/had no say in the matter. Ah what the hell... 90% of the people in this country are blissfully ignorant to what is really going on anyway.
In case you haven't noticed, the current system is failing miserably and the US dollar is worth less and less as time goes by. The US people are slowly being robbed. The Federal reserve is pulling all the strings now. With each crisis, they gain more and more control.
For those who do not know, the "Federal" Reserve has nothing to do with the US government... it's a group of private bankers... a cartel who controls the entire banking and currency systems of the US. Their ultimate goal is total control... a one world currency and a one world bank.
Anyone on this forum that wants to learn the real truth of what the Federal Reserve system is all about should read: "The Creature from Jekyll Island". It will open your eyes. If you don't have the time to read it, please listen to the following series of youtube vids: http://http://www.youtube.com/watch?v=F3TAh1gy6rc
Yes that's right... gold and silver is the only real money. Fiat currencies (backed by nothing) ultimately fail... history has proved this.
Sorry for the typo... I meant Paulson was "appointed", which is even worse that being elected because the American sheeple have/had no say in the matter. Ah what the hell... 90% of the people in this country are blissfully ignorant to what is really going on anyway.
In case you haven't noticed, the current system is failing miserably and the US dollar is worth less and less as time goes by. The US people are slowly being robbed. The Federal reserve is pulling all the strings now. With each crisis, they gain more and more control.
For those who do not know, the "Federal" Reserve has nothing to do with the US government... it's a group of private bankers... a cartel who controls the entire banking and currency systems of the US. Their ultimate goal is total control... a one world currency and a one world bank.
Anyone on this forum that wants to learn the real truth of what the Federal Reserve system is all about should read: "The Creature from Jekyll Island". It will open your eyes. If you don't have the time to read it, please listen to the following series of youtube vids: http://http://www.youtube.com/watch?v=F3TAh1gy6rc
Ooooops... another one of my rants. Sorry about that Domer. I promise, that gift card is on it's way!
gold and silver are worth something only if a vast majority of people whom you deal with find similar value and exchangeable for services or goods that are of value to you. if you raised a human and taught that gold and silver are worthless metals, it will be of no value to that human until someone was willing to trade it for a service or goods that the human wants, then that value is established - in that gold & silver has no advantage over "fiat money" from a perception's perspective. however, there are thousands of true and value added industrial uses for gold & silver, aside from making women pretty and men poorer, that gives them great usable value, and since gold & silver are in limited enough supply, their perceived value is higher and more stable vs. printed/coined money. if one day humans were able to master the technology to mine outer planets & asteroids, we'll find that gold & silver, or other rare earth elements for that matter, may not be worth the same as they are today.
oh and if you like that non-sense about the Fed, watch Zeitgeist - free movie that you can download, it'll help further your nuttiness.
at the end of the day, our dollar is worth exactly what everyone else in this globalized world think it's worth. am i worried about inflation from the borrowing? you bet i am. do i think we AMERICANS are wrong spending the money? no - we are once again taking a leadership position when the rest of the world is too chicken to act (well, china's doing it because they don't want the 30 million unemployed factory workers rise up and revolt, otherwise they probably won't care as much). do i think some of the GOP governors like sanford are showing their true colors when it comes to politicizing money that will help a vast majority of people who can't help themselves (i.e. people who don't usually vote GOP anyways)? hell yeah, but if their citizens are blind enough not to see that and re-elect him, that's their problem. Mitch is not half bad though his challenger last year was just way too weak and had no chance at all to begin with.
back to banking, here's what i recommend for people who still have some money left:
1. bank with an online bank like E-Trade or Schwab which offers substantially higher interest rates over any local banks here for both checking & savings. note that all ATM transactions are FREE, no minimums are required, no fees are involved, and you can do direct deposit and pay all your bills online anyway. sign up for a schwab visa card which gives you 2% cash back every month (as opposed to waiting a whole year for AmEx or waiting for citibank points to build up to a certain number).
2. open a super basic checking or savings account with a local bank that's convenient for you (chase, city national, key, whatever) that has no fees and no minimums - this way if you come across cash or check you need to deposit, you can do so and then ACH the funds over to your online bank and make it work harder.
big retail banks with branches will rape you for parking your money, i find the 24-hour service from online banks like etrade or schwab just as good if not better, and the only time i use chase is to make physical deposits that i get once in a blue moon (rebate checks, cash, etc.)
so unless you withdraw over $2K cash on a regular basis (drug habits, high price escorts, money laundering, etc.), i suggest the above solution if you are somewhat computer literate and want your liquid cash to work as hard as possible for you.
on a side note, for security purposes, i suggest a private VPN for your computer plus using OpenDNS on your wifi router at home; also, make sure you have at least WEP password protection for your WiFi router (it can be cracked easily but at least it requires some computer skills and time). finally, if you keep usernames & passwords on your computer, download an encryption software like TrueCrypt (open source/free) and encrypt your personal data. this way if someone broke in and took your computer, at least your private data is secured by 256-bit encryption algorithms.
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