We’ve been reporting, blogging and even screaming about the blatant manipulation of gold and silver for years now. And in spite of the piles of evidence presented, our concerns have been consistently dismissed as the ravings of rogue conspiracy theorists. No one dares to believe that large, well-monitored, too-big-to-fail-type banks, centered in the public eye, could be party to such absurd and ludicrous charges. But last week, in a court of law, Deutsche Bank settled a civil suit. In addition to the payment of penalties, they agreed to disclose all pertinent information regarding all parties involved in the years of direct manipulation of London Spot price fixing. HSBC, UBS and Bank of Nova Scotia, among others, are sure to start circling the wagons. By knowing the prices in advance, Board members and the banks they represent were able to profit wildly and at will. The fines will most certainly represent only pennies on the dollar, but it will finally display the type of unscrupulous practices that these “trusted” entities conduct on a daily basis, without regard for anything except their own interests and pocketbooks.
But let’s be serious, when you operate a business model that allows you to take money from Peter and pay minimal interest, then turn around and loan the same money to Paul (with an 850 FICO score) for twice the interest, you become pretty spoiled, pretty quickly. Apparently, the temptation to eliminate all downside risk becomes not only challenging, but somewhat overwhelming. Most businessmen can handle the temptation, but our system is actually set up to push, facilitate and reward greater risk. I say that, because our current system rewards success, but completely ignores a logical concern for risk. Banks have been granted a free pass, by making them too big to fail. The CEO’s responsible for the failure are given a golden parachute, they may never work again, but with billions in the bank, why would they want to? At every turn, the weight of the world is put squarely on the shoulders of the American taxpayer. Go ahead, test my theory, and miss a credit card payment. You’ll receive a late charge, your APR will be increased and your credit score will be negatively affected. Period! It’s automatic. “Bill ‘em.” It’s the default mode. The fact that your invoice was lost in the mail and you never received it is immaterial. The fact that you sent your payment, but it was lost in the mail and never received is immaterial. Bring this matter to the attention of the bank and they’ll tell you that as long as it’s not a regular occurrence, they’ll be happy to reverse the charges. Gee, that sounds great, but you and I know the reality. You pick up the phone and spend twenty minutes trying to maneuver your way through a brutal maze of voicemail hell. Once you get to a customer service representative, in some cases it may be that easy, but a consumer’s time is valuable and nevertheless, it is utterly disrespected.
I have a checking account with Bank of America. In the center of my checks is an indicium stating “valued customer since 1971.” Forty five years I’ve had that account and last week I was informed by a letter that effective May 1, 2016 my free checking account will begin costing me $25 per month, unless I sign up for some form of auto deposit. Really? Many global central banks have implemented negative interest rates, so in the name of greater profit, it makes perfect sense for banks to eliminate the interest payment to Peter and yes of course, why stop there? Go directly to default mode and “bill ‘em.” Let this bank betrayal settle in. Next time, we’ll shine this same bright light on our government.