While most people fear of losing their jobs due to the tough economic times, the banks are making boatloads of money. The only reason for this is because of the intervention of the united states government. As the biggest banks of America were seen as too big to fail, the government quickly aided the struggling banks with a stimulus plan. But now these big banks are profiting from the bad economic situation. Instead of giving more loans and decreasing their other high risk activities they are doing the exact opposite. With an all time low interest rate, the banks are able to lend money at no cost and investing it in high risk areas like stocks or bonds. The competition was also thinned down since last year which makes them able to lend money at even higher interest rates. The stimulus money from the government was to save the banks but with the expectation that they would get smaller and focus more on the traditional actions like lending money.
I think that the stimulus plan of the government was good and absolutely necessaries. This doesn’t mean I agree with the current actions of the banks. Although they are saying they want more regulations, it just seems that it’s business as usual. They totally ignore the working people and only focus on making the most money. The government should have had a lot more conditions for the stimulus plan and enforce those conditions.
source: http://www.nytimes.com/2009/10/17/business/economy/17wall.html?ref=politics
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