In August of 2000, I opened a checking account with SouthTrust bank. In 2004, SouthTrust was purchased by Wachovia. Today, as I opened my browser to check my fantasy football scores, I was met with the news that Citigroup is now buying Wachovia.
I can’t say that I’m surprised, but I will say that I’m disappointed. This didn’t have to happen. Quoting from this story about the acquisition –
Wachovia’s problems stem largely from its acquisition of mortgage lender Golden West Financial Corp. in 2006 for roughly $25 billion at the height of the nation’s housing boom. With that purchase, Wachovia inherited a deteriorating $122 billion portfolio of Pick-A-Payment loans, Golden West’s specialty, which let borrowers skip some payments. (Emphasis mine.)
Now, it appears, that Wachovia, at least in its current form, will go away. I’ll have to make a choice about whether to stay with the new company, Citigroup, or find another bank.
I’m getting sick and tired of reading about government bailouts, mortgage defaults, and bank failures. All of this could have been avoided if companies had followed solid lending practices and consumers had followed solid borrowing practices. Instead, companies and consumers fell in love with exotic lending and borrowing schemes, and now every tax payer will pay for their, combined, foolishness.
I have also involuntarily switched banks. I’m dumbfounded at the degree to which this nation is obsessed with buying things with other people’s money. Listening to Bush, it’s clear that (in his view at least) the economy utterly relies on credit.
I heard the news from a friend this evening. It’s so sad because my local Wachovia branches have wonderful people working there. Now, I’m seriously thinking I need to open an account at the credit union.
Just as great nations of the past, greed was their downfall. America need to be careful
time to party
bye bye Wachovia, hail hail to citigroup.
i’m very concerned about the bank consolidation going on. citi now is an over $2trillion dollar company. that is simply scary.
The same thing happened to WAMU(Washington Mutual),they had the highest p’s in the banking industry a year ago,and they also started buying out bad mortage companies.
I can’t help but wonder if this whole economic thing was planned by the banksters just like they did in the 1930’s.
I mean after all it is still JP Morgan,and so forth that seem to always come to the rescue.
Wake up they are merely a holding company for the bad debts.
And of course they are going to get billions even though they paid pennies on the dollar for the bad debts.This is going to be very profitable for them.
And the whole process of deregulating the banks in 1998,as well as allowing the cross selling of services amongst themselves pretty much destroyed any outside auditing.
People didn’t learn years ago that cross selling inside was dangerous a major factor resulting in the cooked books of Enron.
How about in eptemember 2003 New York State Attorney General Eliot Spitzer seeked info about the lending practices of the banks,including Wells Fargo.
Injunctive relief was sought by both the Office of the Comptroller of Currency and one by the Clearinghouse association of banks,citing Spitzer had no authority to request such inforation.
Well the fab judges granted the relief and the case was dissmissed how convienant I’d say.
This whole thing stinks across the board,legislative,Judicial,and Executive.