More attention has been brought to the world of banking then ever before. This is a good thing. Obviously, the banks are not happy with the extreme focus on their business practices, for very good reasons. Ever since the early Eighties and the dawn of deregulation, the banks have struggled to find new streams of revenue. They have tried to become the one-stop shop for all of your financial and investment needs. The good news is that they became more creative in their product lines for personal and business clients, which has made credit easier to attain, and have added many services to support the need for convenience in our lives. Businesses can fill out a simple one-page document to apply for a loan. We can take care of financial issues online, by phone, at an ATM or by traditional means — in person.
I think by now you’ve learned the bad news. Taking cues from the brokerage and mortgage houses, they have taken full advantage by selling customers every product and service under the sun, without the systems and in- depth staff training needed to deliver these products with integrity. The strategy of pushing products has been one of the major mistakes by the banking industry. The new lines of business created to drive profitability instead helped create the catastrophe of an economy we are faced with today. Banks were allowed to find ways to increase profits and keep shareholders happy, rather than build quality relationships with clients or work with regulators to ensure safe and secure products and delivery systems. Giving these financial companies bailout money will allow them to continue their strategy and allow them to do business as usual. Bank management has long needed to face the music and realize the days of feeling untouchable are over. Giving them an out is a loss for all of us.