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Thread: banks that steal

  1. #1 banks that steal 
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    i wonder if bank tellers in USA are too fast and try to shortchange you

    in other decades were people more careful?


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  3. #2  
    Forum Radioactive Isotope cosmictraveler's Avatar
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    Many transactions are done today with ATM's so that doesn't happen much. Even with dealing with human tellers It doesn't happen much with them either for most people count their money when they receive It from a teller.

    The real problem is banks use other peoples money to make their own profits and never use their own actual money. As an example banks will lend money they have in their vaults that is there from depositors' and charge interest on that loan.


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  4. #3  
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    i deposited cash and she said i gave her less-all the cash was whisked fast into drawer
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  5. #4  
    Universal Mind John Galt's Avatar
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    Quote Originally Posted by cosmictraveler View Post
    The real problem is banks use other peoples money to make their own profits and never use their own actual money. As an example banks will lend money they have in their vaults that is there from depositors' and charge interest on that loan.
    No. That's not the problem with banking. That is the function of banking. When carried out correctly it is beneficial to depositors, borrowers and banks alike.

    i deposited cash and she said i gave her less-all the cash was whisked fast into drawer
    There are three possibilities.

    1. You made a mistake and she made an accurate count.
    2. She made a mistake.
    3. She deliberately lied to you.

    If option 3 is true there are further possibilities.

    1. This was the only time she had done this.
    2. She does it frequently, but is not typical of other tellers.
    3. She and many other tellers do this, but without the bank's knowledge.
    4. She and many other tellers do this, but with the bank's knowledge.
    5. She and many other tellers do this, with the bank's knowledge and under the direction of the bank.

    Only if point 5 is true can your thread title be justified. Do you seriously think 5 is true?
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  6. #5  
    Forum Radioactive Isotope cosmictraveler's Avatar
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    You deposit money and the bank lends It out with Interest attached.
    When the power of love overcomes the love of power the world will know peace.
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  7. #6  
    Forum Radioactive Isotope cosmictraveler's Avatar
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    Most banks In the Mideast do not charge Interest and those banks are working fine.
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  8. #7  
    Universal Mind John Galt's Avatar
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    Quote Originally Posted by cosmictraveler View Post
    Most banks In the Mideast do not charge Interest and those banks are working fine.
    I'm no economist, but how the hell does that work? Citation please. (A link to a bank's lending rules would do nicely.)
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  9. #8  
    ▼▼ dn ʎɐʍ sıɥʇ ▼▼ RedPanda's Avatar
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    Quote Originally Posted by John Galt View Post
    Quote Originally Posted by cosmictraveler View Post
    Most banks In the Mideast do not charge Interest and those banks are working fine.
    I'm no economist, but how the hell does that work? Citation please. (A link to a bank's lending rules would do nicely.)
    I am thinking they are referring to Islamic banking: Interest And Islamic Banking - Finance and Banking - Worldwide

    But it's a bit of a semantic argument. They do still charge interest, but they call it something else instead (e.g usury).
    SayBigWords.com/say/3FC

    "And, behold, I come quickly;" Revelation 22:12

    "Religions are like sausages. When you know how they are made, you no longer want them."
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  10. #9  
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    Ah yes. When I read Mideast, I thought in terms of the mid-eastern states of the USA, which is rather bizarre since I'm presently sitting in Dubai.

    You are correct it is interest by another name, perhaps better and more fairly administered, but interest none the less. (Girds loins for predictable attack by offended Islamist. Wonders if it will be the wife.)
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  11. #10  
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    Quote Originally Posted by SHolmes View Post
    i deposited cash and she said i gave her less-all the cash was whisked fast into drawer
    Get the bank manager and make them count the drawer. problem solved
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  12. #11  
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    Quote Originally Posted by cosmictraveler View Post
    You deposit money and the bank lends It out with Interest attached.
    Actually, banks do not need deposits to create loans. It's endogenous money: Bank lending creates deposits.

    Banks do not steal a priori. Bank is an institution form that handles money capital. In normal conditions money capital receives a profit (through the interest rate) which equals the general rate of profit of the economy. If you forget for a minute the marxian literature about surplus value, then there's no stealing. Even if you include marxian concepts like exploitation of labour etc, money capital just distributes the already produced and accumulated surplus. So again, there's no stealing.

    But, when it comes to real life it's true that recent financial practices (not only by banks but from financial and non-financial enterprises as well) do indeed "steal" money. For a sophisticated explanation of how does that happen, have a look: VersoBooks.com

    In your case sholmes, consider John's 1-3.
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  13. #12  
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    You deposit money and the bank lends It out
    Technically Banks dont even lend the money that is deposited btw. They dont say we are lending you farmer Joe's money. They create new money out of thin air as an accounting entry. The amount of money they can create is a proportion of the money they have in reserve. The trick is whoever gets the (funny accounting entry) money as payment (house) from the person that was loaned out the money, deposits this as if it was real money, and since this process is repeated, 100 people have money they think is theirs when there is only enough money for lets say 10. If there is a big default or bank run, what most people fail to understand is that money vanishes because the ponzi scheme illusion veil is lifted, tada! there's nothing! Most people have the reflex of saying "hey dam it, where is my money?" (as if it existed and just is somewhere else)

    Further, many people that fall for the Gold standard red herring meme, also fail to understand that no matter how sound and solid and rare your gold is, if fractional reserve banking is used, you are just as vulnerable to the tada! theres nothing! situation as if it was toilet paper (unless you keep it and dont deposit it in a fractional reserve bank). And then they would have a bewildered expression "but... but... where did my solid gold go? Where is it? Who has it? Its solid gold it cant vanish?" because multiple people thought they owned the same gold coin.
    Last edited by icewendigo; February 19th, 2014 at 02:40 PM.
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    I stopped dealing with one of Canada's major banks one day. I was pissed off at them so I did the only thing I could to fight back, go somewhere else. Anyway what I didn't know is that when I closed my account, I missed a small savings account I forgot I had. Turned out there was about $300 in there. Months go by and the next thing I know a bill arrives in the mail from my old bank saying I owed them $60. Went over there to learn that the forgotten account was set up for the bank to automatically withdraw so much a month from it for banking fees. They had used up the $300 and covered an extra 60 bucks before telling me. I remember standing there arguing, they threatened to ruin my credit if I didn't pay. As people were watching I stepped back and I said in a strong voice so everyone could hear, " A crook comes in to hold up a bank, I come here to get held up by the bank". A couple of people laughed, I paid the money and never went back but I felt good.
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  15. #14  
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    Quote Originally Posted by icewendigo View Post
    You deposit money and the bank lends It out
    Technically Banks dont even lend the money that is deposited btw. They dont say we are lending you farmer Joe's money. They create new money out of thin air as an accounting entry. The amount of money they can create is a proportion of the money they have in reserve. The trick is whoever gets the (funny accounting entry) money that was loaned out deposits this as if it was real money, and since this process is repeated, 100 people have money they think is theirs when there is only enough money for lets say 10. If there is a big default or bank run, what most people fail to understand is that money vanishes because the ponzi scheme illusion veil is lifted, tada! there's nothing! Most people have the reflex of saying "hey dam it, where is my money?" (as if it existed and just is somewhere else)

    Further, many people that fall for the Gold standard red herring meme, also fail to understand that no matter how sound and solid and rare your gold is, if fractional reserve banking is used, you are just as vulnerable to the tada! theres nothing! situation as if it was toilet paper (unless you keep it and dont deposit it in a fractional reserve bank). And then they would have a bewildered expression "but... but... where did my solid gold go? Where is it? Who has it? Its solid gold it cant vanish?" because multiple people thought they owned the same gold coin.
    Right. Fractional reserve. They're allowed to loan out several times what they have in deposit. If the recipients of the loans decide to deposit any of the money loaned to them, then that increases the deposit.

    So in theory, in a 5x reserve situation for example, a bank could lend a dollar to someone, who then deposits it, enabling the bank to lend them 5 dollars, and then if they deposit the 5 dollars, the bank could lend them 25 dollars...... etc....

    It usually doesn't happen quite so directly. More often the first guy takes out a loan to buy a house, and then the person they bought the house from deposits the money, which allows the bank to loan out more money.... and so on. It's just a different person depositing the money every time, instead of the same person.
    Some clocks are only right twice a day, but they are still right when they are right.
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  16. #15  
    Forum Cosmic Wizard icewendigo's Avatar
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    More often the first guy takes out a loan to buy a house, and then the person they bought the house from deposits the money,
    Then the following was unclear because thats what I meant by it;
    "whoever gets the (funny accounting entry) money that was loaned out deposits this as if it was real money,"
    I should have said whoever obtains the money as a payment from the person that got the loan
    will edit it
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  17. #16  
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    Quote Originally Posted by kojax View Post
    Quote Originally Posted by icewendigo View Post
    You deposit money and the bank lends It out
    Technically Banks dont even lend the money that is deposited btw. They dont say we are lending you farmer Joe's money. They create new money out of thin air as an accounting entry. The amount of money they can create is a proportion of the money they have in reserve. The trick is whoever gets the (funny accounting entry) money that was loaned out deposits this as if it was real money, and since this process is repeated, 100 people have money they think is theirs when there is only enough money for lets say 10. If there is a big default or bank run, what most people fail to understand is that money vanishes because the ponzi scheme illusion veil is lifted, tada! there's nothing! Most people have the reflex of saying "hey dam it, where is my money?" (as if it existed and just is somewhere else)

    Further, many people that fall for the Gold standard red herring meme, also fail to understand that no matter how sound and solid and rare your gold is, if fractional reserve banking is used, you are just as vulnerable to the tada! theres nothing! situation as if it was toilet paper (unless you keep it and dont deposit it in a fractional reserve bank). And then they would have a bewildered expression "but... but... where did my solid gold go? Where is it? Who has it? Its solid gold it cant vanish?" because multiple people thought they owned the same gold coin.
    Right. Fractional reserve. They're allowed to loan out several times what they have in deposit. If the recipients of the loans decide to deposit any of the money loaned to them, then that increases the deposit.

    So in theory, in a 5x reserve situation for example, a bank could lend a dollar to someone, who then deposits it, enabling the bank to lend them 5 dollars, and then if they deposit the 5 dollars, the bank could lend them 25 dollars...... etc....

    It usually doesn't happen quite so directly. More often the first guy takes out a loan to buy a house, and then the person they bought the house from deposits the money, which allows the bank to loan out more money.... and so on. It's just a different person depositing the money every time, instead of the same person.
    You're presenting the money multiplier model. That's the standard story. Well, I'd argue that this is a myth actually (at least that's what empirical research found out- have a look at FED paper "Money, Reserves, and the Transmission of Monetary Policy: Does the Money Multiplier Exist?”)

    On my view (which is not exclusively mine obviously) it's endogenous money. Bank lending creates deposits; so the decisions of banks to provide loans determine the level of money. This has (almost) nothing to do with reserves.

    Indeed, in most cases credit money moves first, followed by base money (reserves). Central bank can not control money supply as strictly as we are told it can. In reality, banks do not consider reserves when lending. They use double entry bookkeeping to create an asset (a loan) and a liability (a deposit, in which the loan is ‘stored.’) at the same time. As a result, the books are balanced. If they ever need reserves they will borrow them from other banks. (or even by CB/FED if they fail to borrow from banks market). IF CB say no, then the banks market (and the whole credit market) will collapse and interest rates will go really wild, it's not a matter of policy here. So, an increase in money base (eg what bernanke essentially did) will not lead necessarily to higher lending (which is what happened, mostly). That can be easily explained by the credit accelerator (which is the change in the change in debt divided by gdp) (and other variables like total profitability etc which determine economic activity) but can not be explained by money multiplier.

    This mechanism has several interesting characteristics. Expanding debt means more aggregate demand, reducing debt means lower aggregate demand (and potentially a recession). This has nothing to do with distribution of debt (which may also affect the AD depending the multipliers) or incomes.
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  18. #17  
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    trying to read all these replies-too tired too busy
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    I haven't yet read any of this thread. I thought maybe it was a joke thread, for a second.
    But, no. It's not.
    I;m sure I'll have some things to say that will be unpopular, to many. I'll give that a shot, anyway. Here's a preview: All banks steal
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  20. #19  
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    banking fun
    fun?
    huh-wut?
    the last two times i dealt with banks were bizarre-----and fun?
    ok
    first---I went to my local bank to cash some dividend checks
    I had added them up first and written the total on the back of the envelope
    so the clerk/cashier added them up and came up with a different number
    hmmmm
    I noticed a senior cashier hovering in the background
    "try adding them again" said I
    and she did
    and again came up with a wrong number
    "lemme guess" said I, "OJT?"
    "OJT?" queried the teller
    "On the Job Training" said I, "Lemme guess, this is your first day?"
    "yes" said she
    as she added the checks up again, and came up with the number on the envelope
    "Yippee" said I, "You see the more we work together, the more we agree."
    And so we proceeded and I recounted every transaction as a parade was gathering behind me
    so, said I" I seem to be at the head of a parade, and everyone can see my tonsure"
    She seemed confused---------and I said "relax, you will only have one 'first day'"
    .................
    next
    we needed the interest on a savings account for the taxes
    so, I called the bank and was told that the account was dormant and had been sent to the state---the jackass on the phone claimed that that was because of the government's "patriot act".
    so, I called the state treasurer, while looking up the regulations on-line(and found that he had lied)
    The treasurer couldn't find my account, and said that she would investigate further and call me back.
    The next day, I recalled her direct line and she said that she had searched their records and not found the account, so, she had called the bank, and they still had my account.
    This was fast becoming a royal pain in the ass and a damned odd experience.
    So, I called the bank back and asked to talk to an officer. I told the officer of the preceding communications and asked for her opinion as to the status of that savings account. She found the account information, and i asked for the current balance, and voiced my dissatisfaction with the comments and lies of the previous jackass, and recommended his dismissal.
    .................
    When you deal with people. some are competent, and some aren't; some are honest, and some aren't.
    ----------------
    That is the nature of the game.
    Last edited by sculptor; March 29th, 2014 at 05:10 PM.
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  21. #20  
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    If Humans are involved, something's gonna' go wrong. Not every time, but eventually. I was shorted $100 at my bank once and hadn't paid enough attention to notice 'til I got to my car. They corrected the mistake, but the teller had to count her drawer to confirm it. I felt embarrassed.
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  22. #21  
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    weird stories
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  23. #22  
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    i think most large banks 'steal' money by legal means. i mean that the investments they sell customers have hidden and very high fees. also high interest loans. all legal though. bank tellers shorting customers can not be common and if it happens it is accidental. if not accidental then teller is fired.
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  24. #23  
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    If you find a good and cooperative banker stick with him/her.
    If you find a schmuck move the account.

    Long ago, I ran a small business and accepted checks, some of which bounced.
    Back then, savings accounts paid interest, and checking accounts didn't, so I kept most money in a savings account.
    When people gave me bad checks, the bank deducted from the checking account---which led to me bouncing checks while money sat almost idle in the savings account.
    I went in to talk to a bank officer, and met the officer, James Lemacher, and explained my situation and asked him if he could:
    A)flag the account and call me if someone wrote a bad check to me or the business(so I could react in a timely manner)
    and
    B) transfer money in $100 increments from savings to checking as needed.
    He agreed to both and as we chatted, he told me of other banking regulations.

    Ever since then, Mr. Lemacher has been my touchstone for banker's behaviors. If the current banker didn't measure up, I sought another bank.

    Banks make money on loans, and make money loaning out moneys which you deposit with them. If the people there behave badly, there will always be another bank that welcomes your business.
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  25. #24  
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    If you think 'banker's hours' are kind to bankers try imagining "Bankers Ethics". Invent new "securities" and investment strategies composed mainly of bad loans bungled-together into marketable shares of nothing of any actual value, and then offer these to market investors/gamblers. When this strategy comes-apart at the seems, simply have the government pass-on bank's losses to the public, to whom bank's will not loan money, unless it can be shown that the loan-seeker does NOT NEED A LOAN. Make sense ?
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