4 ms·

Because you aren't actually entitled to online banking services from Chase, and if we lived in a world where, "I didn't read what I signed" was a valid defense,

by Zetice 3y ago

Because you aren't actually entitled to online banking services from Chase, and if we lived in a world where, "I didn't read what I signed" was a valid defense, contracts would be more or less unenforceable. This is much more okay than the alternative, in other words.

amluto 3y ago
Really? I tend to think that people should be entitled to free basic banking. In general, many more services ought to be treated as common carrier services than actually are.
- deleted 3y ago
  [deleted]
- SideQuark 3y ago
  Who pays for your free banking? Other people? Taxpayers? How about people realize services cost money and pay their own way?
  - godelski 3y ago
    > Who pays for your free banking? Other people? Taxpayers? Yes. I'm happy to do so. Can't the gov even make money through this? Seems like they could buy bonds with that money. But I'm no economist > How about people realize services cost money and pay their own way? That's not the calculus. It's part of it but far (FAR) from the whole calculus. There's also the cost of not providing the services. Again, there's more to the calculus, but this other side always needs to be considered and almost never is because we weigh money spent far more then rewards not received. But the ability to do this is exactly what makes us human and distinct from many animals
  - amluto 3y ago
    The bank, which makes (a little bit of) money off the low-income, low-wealth customers but an absolute crapload of money off the business as a whole. Keep in mind that banks receive enormous support from the government and society. There’s the FDIC, Fannie Mae, Freddy Mac, the Fed (and its discount window, FedWire, etc), the fact that banks are effectively permitted to create M2 money, and more. And the governments (federal and state) essentially require a bank account to do many useful things, including paying taxes. The government regulates the banks quite firmly in exchange, but the regulation is missing the bits where the banks may not refuse service or abuse their customers.
    - godelski 3y ago
      Exactly, the social contract is that the government plays a role in the market to 1) ensure competition actually exists and 2) consumers can't be bullied into harmful practices. It's a constant cat and mouse game too. (there are more things the gov does too). Both of these we've seen the government hold up frequently in the past. We monopoly bust as well as bust when companies become too big. For some reason people think precise monopolies are different from effective monopolies. Contract law itself doesn't allow you to put illegal things into the contract. Anarchocapitalism doesn't work, despite libertarian beliefs because power is not linearly proportional, natural monopolies exist, and collusion exists. Two-three big companies that control 70% of a market can all gain if they decide to include clauses where they acquire all your assets immediately. Insurance companies can maximize profits by kicking you out as soon as you get sick and requiring that you have to have one. The solution spaces are large and even when competition exists the nash equilibrium isn't always what's best for consumers. Nuance is requires because multiple solutions exist, not just the one we want to exist.
    - SideQuark 3y ago
      >but an absolute crapload of money off the business as a whole. Of the 11 sectors making up the S&P 500, over the last 15 years, finance is one of the least profitable. Banks are not very profitable compared to other sectors of the economy. [1] The reason is there are ~5000 banks in the US, and a huge number you can choose from. If a few banks were simply charging tons more than it actually costs to run a bank, another of the 5000 would lower costs and attract more customers from the costly banks. The largest bank by deposits, JP Morgan Chase, holds < 8% of deposits held by banks. There is no monopoly, or duopoly, or anything approaching market dominance. [2] If you're sure they making "an absolute crapload" you should invest in them. But since in reality they are not very good investments, you should rethink your beliefs. Your beliefs simply are not true, as demonstrated by market evidence. >Keep in mind that banks receive enormous support from the government and society. Keep in mind that society and government receives enormous support from banking. That's why they have trillions in assets - because they provide value to those using banks. When people, or govt, chooses to use a bank, both sides gain (consumer and producer surplus in economics). So the amount of business some entity obtains is reasonably proportional to the amount of utility they provide to customers. This is simple econ. >There’s the FDIC Paid for by banks.... >Fannie Mae, Freddy Mac Paid for by, you guessed it, banks.... Where do you think the loans the FMs holds originate? >the Fed (and its discount window, FedWire, etc) Designed to help banking remain stable from bank runs, from, guess what, panics of people. It's such a good system for stability compared to previous times that the structure has been adopted by all 200+ countries on the planet. Not a single one has decided not to use this structure. >the fact that banks are effectively permitted to create M2 money A common misconception - it is not "free" money. It is backed by an exactly equal debt, netting zero in assets for the bank. To cover the risk that the borrower defaults, the bank charges interest. If the bank makes enough bad loans, the bank, not you, lose money. The alternative is no loans, for college, cars, houses, payroll, etc. >the governments (federal and state) essentially require a bank To fund their functioning. How do you think the govt runs a deficit? Banks lend them money. Without the markets made by the banks to provide liquidity to govt, at the municipal, state, and federal level, society would be tremendously worse off. Go spend time learning how the bond markets work, how treasuries work, detailed differences between the Fed and Treasury, and look at historical events and how they were paid for. >the regulation is missing the bits where the banks may not refuse service or abuse their customers Then you have not read any laws, ignore the many agencies that precisely do this, or the long history of punishments. [1] https://novelinvestor.com/sector-performance/ https://novelinvestor.com/sector-performance/ [2] https://www.statista.com/statistics/727546/market-share-of-leading-banks-usa-domestic-deposits/ https://www.statista.com/statistics/727546/market-share-of-l...
- weberer 3y ago
  >I tend to think that people should be entitled to free basic banking It sounds like you want a credit union.
- Zetice 3y ago
  Free banking is not free online banking.
throwaway2037 3y ago
you aren't actually entitled to online banking services from Chase While this may be true today, it would be better if regulators would make it a rule. It's a great suggestion to send to regulators.
siva7 3y ago
You realize the difference between a contract and what this article is about? Besides that this change wouldn't fly in some european countries for similiar reasons parent cited
thatguy0900 3y ago
And what bank can I go to where opening an account doesn't involve 100 pages of legalese that I agree to?
andreareina 3y ago
Initials on clauses; witnesses; notarization; these are all ways to indicate that a contract has been read. If the contract is so long that initialing every clause/paragraph is a burden, maybe that's a sign that it's too damn long.
crote 3y ago
Contracts are not automatically valid just because you signed them, though. For example, if I buried a clause stating that you transfer all your assets to me somewhere deep inside my website's Terms of Use, there is no way in hell I will be able to enforce that. It would be considered an "unconscionable contract", and it would be voided. An on-topic example would be Uber v. Heller, where an arbitration clause in the contract was ruled unconscionable, and as a result the plaintiff was allowed to file a class action lawsuit against Uber. Similarly, clauses can be deemed unconscionable because they are an "unfair surprise". An example is Williams v. Walker-Thomas Furniture Co, where the fact that Williams did not understand the contract was considered to be a major factor for the contract being unenforceable. So yeah, when it comes to a contract between an individual and a large business, "I didn't read it and assumed it to just be the standard legalese stuff" is in fact a valid defense.
- Zetice 3y ago
  So you believe corporations require you to sign these agreements even though they’re unenforceable? Interesting, and not supported by the case law.
pixelatedindex 3y ago
Me not being entitled to Chase does not make their predatory practices ok, if that’s what you’re getting at. This is a pretty stupid way of looking at things.

by Zetice 3y ago

amluto 3y ago

Really? I tend to think that people should be entitled to free basic banking. In general, many more services ought to be treated as common carrier services than actually are.

deleted 3y ago
[deleted]
SideQuark 3y ago
Who pays for your free banking? Other people? Taxpayers? How about people realize services cost money and pay their own way?
- godelski 3y ago
  > Who pays for your free banking? Other people? Taxpayers? Yes. I'm happy to do so. Can't the gov even make money through this? Seems like they could buy bonds with that money. But I'm no economist > How about people realize services cost money and pay their own way? That's not the calculus. It's part of it but far (FAR) from the whole calculus. There's also the cost of not providing the services. Again, there's more to the calculus, but this other side always needs to be considered and almost never is because we weigh money spent far more then rewards not received. But the ability to do this is exactly what makes us human and distinct from many animals
- amluto 3y ago
  The bank, which makes (a little bit of) money off the low-income, low-wealth customers but an absolute crapload of money off the business as a whole. Keep in mind that banks receive enormous support from the government and society. There’s the FDIC, Fannie Mae, Freddy Mac, the Fed (and its discount window, FedWire, etc), the fact that banks are effectively permitted to create M2 money, and more. And the governments (federal and state) essentially require a bank account to do many useful things, including paying taxes. The government regulates the banks quite firmly in exchange, but the regulation is missing the bits where the banks may not refuse service or abuse their customers.
  - godelski 3y ago
    Exactly, the social contract is that the government plays a role in the market to 1) ensure competition actually exists and 2) consumers can't be bullied into harmful practices. It's a constant cat and mouse game too. (there are more things the gov does too). Both of these we've seen the government hold up frequently in the past. We monopoly bust as well as bust when companies become too big. For some reason people think precise monopolies are different from effective monopolies. Contract law itself doesn't allow you to put illegal things into the contract. Anarchocapitalism doesn't work, despite libertarian beliefs because power is not linearly proportional, natural monopolies exist, and collusion exists. Two-three big companies that control 70% of a market can all gain if they decide to include clauses where they acquire all your assets immediately. Insurance companies can maximize profits by kicking you out as soon as you get sick and requiring that you have to have one. The solution spaces are large and even when competition exists the nash equilibrium isn't always what's best for consumers. Nuance is requires because multiple solutions exist, not just the one we want to exist.
  - SideQuark 3y ago
    >but an absolute crapload of money off the business as a whole. Of the 11 sectors making up the S&P 500, over the last 15 years, finance is one of the least profitable. Banks are not very profitable compared to other sectors of the economy. [1] The reason is there are ~5000 banks in the US, and a huge number you can choose from. If a few banks were simply charging tons more than it actually costs to run a bank, another of the 5000 would lower costs and attract more customers from the costly banks. The largest bank by deposits, JP Morgan Chase, holds < 8% of deposits held by banks. There is no monopoly, or duopoly, or anything approaching market dominance. [2] If you're sure they making "an absolute crapload" you should invest in them. But since in reality they are not very good investments, you should rethink your beliefs. Your beliefs simply are not true, as demonstrated by market evidence. >Keep in mind that banks receive enormous support from the government and society. Keep in mind that society and government receives enormous support from banking. That's why they have trillions in assets - because they provide value to those using banks. When people, or govt, chooses to use a bank, both sides gain (consumer and producer surplus in economics). So the amount of business some entity obtains is reasonably proportional to the amount of utility they provide to customers. This is simple econ. >There’s the FDIC Paid for by banks.... >Fannie Mae, Freddy Mac Paid for by, you guessed it, banks.... Where do you think the loans the FMs holds originate? >the Fed (and its discount window, FedWire, etc) Designed to help banking remain stable from bank runs, from, guess what, panics of people. It's such a good system for stability compared to previous times that the structure has been adopted by all 200+ countries on the planet. Not a single one has decided not to use this structure. >the fact that banks are effectively permitted to create M2 money A common misconception - it is not "free" money. It is backed by an exactly equal debt, netting zero in assets for the bank. To cover the risk that the borrower defaults, the bank charges interest. If the bank makes enough bad loans, the bank, not you, lose money. The alternative is no loans, for college, cars, houses, payroll, etc. >the governments (federal and state) essentially require a bank To fund their functioning. How do you think the govt runs a deficit? Banks lend them money. Without the markets made by the banks to provide liquidity to govt, at the municipal, state, and federal level, society would be tremendously worse off. Go spend time learning how the bond markets work, how treasuries work, detailed differences between the Fed and Treasury, and look at historical events and how they were paid for. >the regulation is missing the bits where the banks may not refuse service or abuse their customers Then you have not read any laws, ignore the many agencies that precisely do this, or the long history of punishments. [1] https://novelinvestor.com/sector-performance/ https://novelinvestor.com/sector-performance/ [2] https://www.statista.com/statistics/727546/market-share-of-leading-banks-usa-domestic-deposits/ https://www.statista.com/statistics/727546/market-share-of-l...
weberer 3y ago
>I tend to think that people should be entitled to free basic banking It sounds like you want a credit union.
Zetice 3y ago
Free banking is not free online banking.

throwaway2037 3y ago

you aren't actually entitled to online banking services from Chase While this may be true today, it would be better if regulators would make it a rule. It's a great suggestion to send to regulators.

siva7 3y ago

You realize the difference between a contract and what this article is about? Besides that this change wouldn't fly in some european countries for similiar reasons parent cited

thatguy0900 3y ago

And what bank can I go to where opening an account doesn't involve 100 pages of legalese that I agree to?

andreareina 3y ago

Initials on clauses; witnesses; notarization; these are all ways to indicate that a contract has been read. If the contract is so long that initialing every clause/paragraph is a burden, maybe that's a sign that it's too damn long.

crote 3y ago

Contracts are not automatically valid just because you signed them, though. For example, if I buried a clause stating that you transfer all your assets to me somewhere deep inside my website's Terms of Use, there is no way in hell I will be able to enforce that. It would be considered an "unconscionable contract", and it would be voided. An on-topic example would be Uber v. Heller, where an arbitration clause in the contract was ruled unconscionable, and as a result the plaintiff was allowed to file a class action lawsuit against Uber. Similarly, clauses can be deemed unconscionable because they are an "unfair surprise". An example is Williams v. Walker-Thomas Furniture Co, where the fact that Williams did not understand the contract was considered to be a major factor for the contract being unenforceable. So yeah, when it comes to a contract between an individual and a large business, "I didn't read it and assumed it to just be the standard legalese stuff" is in fact a valid defense.

Zetice 3y ago
So you believe corporations require you to sign these agreements even though they’re unenforceable? Interesting, and not supported by the case law.

pixelatedindex 3y ago

Me not being entitled to Chase does not make their predatory practices ok, if that’s what you’re getting at. This is a pretty stupid way of looking at things.