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Not sure why you inferred that anyone above supported the auto company bailouts (or the airline bailouts, etc.). Taxes are not paid in exchange for bailouts...
by grandalf 17y ago
Not sure why you inferred that anyone above supported the auto company bailouts (or the airline bailouts, etc.).
Taxes are not paid in exchange for bailouts... at least if they are tell that to all the other companies that have failed over the years and not had the government swoop in to help.
- gaius 17y agoThat's true, but the assertion that that there's no contribution to the economy and society from bank profits is a false one.
- Psyonic 17y agoI don't disagree with that, but simply asserting they pay taxes doesn't prove anything. If they more or less stole the money, paying back 20% is hardly contributing. Not saying they did, the verdict is still out there, but just pointing out that taxes alone don't say much.
- metamemetics 17y agoThere really isn't that big of one. A bank is an entity that uses an unsustainable business plan, fractional reserve banking, and has to rely on a federal subsidy (FDIC insurance) to make it work. They are getting a subsidy to mindlessly arbitrage the yield curve and profit by making riskier loans than they would normally be capable of making. Fractional Reserve lending is NOT necessary for a financial intermediary to function. Look at hedge funds or VC firms. They are investing the amount of money they have received from investors and are not allowed to invest 10X they amount they have without raising that extra amount from somewhere. Banks are not doing anything intelligent that adds significant value, the majority of their profits come from mindlessly arbitraging the yield curve due to a federal subsidy.