Not Paranoid Just Prepared

Bank Closures, the Concentration of Wealth, and Your Money


Our economy is stable and those running it are benevolent and care deeply about all of us. If you believe that, there might be some investment land waiting for you in the swamps of Florida. The graph below is from the FRED website, the Federal Reserve Economic Data database of the Federal Reserve Bank of  St. Louis. In the graph, the decline began in the early 1980’s, during and after the  Savings & Loan scandal, largely perpetuated by Neil Bush, of the Bush monarchy.

You might ask the question, “with all the bank closures, why does it seem like there are still so many banks?”  The answer comes in the now-common phrase “too big to fail.”  For more on that, see Neil Young. Small, failed banks, and even larger ones (see JP Morgan-Chase– the largest bank in the U.S.), have been consumed and taken over by the massive multinational banks whose names are now all-too familiar to everyone.

Some economists argue that this is how free enterprise and the economic system works, that inefficiency is replaced by efficiency and that the market corrects itself. This is true when there is no government intervention. As soon as there is intervention, the notion falls on its face- read about the The Austrian School of economics for more on that. Bailing out the too big to fail banks not only caused the self- correcting market to fall on its face, it bashed its head in from behind with a 2 by 4 first!

Bank Closures over time

Bank Closures over time- 1984-2016.

So, what can we do about it? That should be the question on everyone’s mind.  Whether you believe it or not, your money counts. And when I say “your money”, I do not refer just to the money you have in your savings account. The data says that very few of is have any of that anyway! What I am referring to is what you use as money- your home mortgage, your car loan, your credit cards, and of course your checking and savings accounts. When you have these accounts at Chase or Wells Fargo or Bank of America, you are helping perpetuate the unjust system that will destroy our Republic and eventually all democracy. Sound harsh? Do the research yourself- prove me wrong. Good luck with that.

In the meantime, close your account at Wells Fargo, and open one with you local credit union. Close your Chase credit card and… just don’t use credit cards any more. Truly, this is the smartest move, but it is unrealistic in today’s world. Do some research about which credit cards are more socially responsible and go from there. And my final recommendation, instead of putting money away in a savings account that makes you nothing and the bank 5 or 6% interest, keep the money close at hand and safe. If your savings account is your “emergency fund”, how will it serve you in an emergency if the bank has closed its doors when you need it? Put the money under your mattress, preferably in the form of precious metals. But no matter what, do something! Don’t just sit there thinking someone else is going to save the world. If you do, you’ll end up with our economy- face down in the dirt.

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