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| You're causing problems... Because you're different.... |
First, Doug is one of the "best minds"('course that may not be saying much!) in the credit union movement and is the CEO (pretty young one at that, for all you "Gen-Whatevers"!) over at Bellco CU in Colorado. Doug, in his comment, goes through a litany of "it wasn't us", "we're being unjustly penalized" and over regulated for sins we did not commit leading up to the 2008 Crash . CU's did not yield to the irrational, anti-consumer, mean-spirited predatory lending thievery prior to 2008, yet....
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| Sure, everyone claims they are "different"... |
The penalties of excessive regulation being imposed on us are going to "kill off" most, if not all, of the credit union movement. Why? Because our small size and non-traditional, "one-on-one", direct, personal, service and concern does not meet the traditional, Dodd-Frank, CFPB, NCUA "knows-it-all-but-understands-nothing", "we look foolish and inadequate, but admit no responsibility" punitive regulatory "Hail Marys" being implemented. (Ran out of adjectives, but guess you get the point...)
The "bad guys" created the problem; the "bad guys" must be regulated; the "bad guys" are the only ones who can afford to implement the new regulations... so who wins ??? - "the bad guys"....
CREDIT UNIONS ARE THE BLACK SWANS OF THE CONSUMER FINANCIAL WORLD
...but we never made our case before the crisis that we truly were different !! So yes, we will now pay the price for having never had the will to advocate for our principles.
Credit unions are "politically unbelievable" ...
that's a dangerous place to be when you are confronting the established elite and political clout of a financial world who would prefer to claim that...
that's a dangerous place to be when you are confronting the established elite and political clout of a financial world who would prefer to claim that...
BLACK SWANS DO NOT EXIST !!
10 comments:
New regulations do not make the markets free or fair! Arresting scoundrels works much better. Anthony from Countrywide (a company that had a lot of relationships with credit unions)left with a bundle of money and a broken company.
Financial mania happen when people let greed take over. We tend to forget that there is a sucker born every minute and two to take their money away.
We are unbelievably, as a nation, bad with math of life. We make extremely poor decisions because we do not understand the math of the decision. Putting in granite counter tops does not add more value to something greater than the cost of the counter top. Yet people were putting additional values on a home because they had a granite counter top.
Cannot count the number of times I advised people that they were over paying for a house, only to hear, I will flip it next year at a profit. Leverage is a two edge sword. Exponential growth in any investment eventually comes to an end. Leverage in reverse hurts.
Credit unions need to embrace their true roll in the financial system and be an alternative to what banks and other financial service provider offer the consumer. Embracing or being forced to act like banks because of heavy handed regulations promulgated by the CPFB, the NCUA, etc., will not provide protection. They will screw up the unfair and unfree markets even worse than they currently are.
The best solution is an educated consumer armed with information so they can make a proper economic decision. Only information makes the markets free and fair.
Ummm, I took a look at the 4/22 comments of D.F. and it seems as if corporate credit unions are some imaginary group of financial institutions. Although "retail" credit unions did not "cause" the financial crisis, corporate credit unions were sure drinking the same mbs koolaid. Making bad loans were just part of the financial crisis, the selling and buying of them on the secondary market was its co-conspirator. Our hands are not completely clean; that is why we are paying assessments to no end now!
Yes and rating agencies are pure as the driven snow. You just dont get it DF. Next thing you will be accusing those BB's of unfairly setting LIBOR to make some cash. For shame!!!
I fully agree we did not show people there was a Black Swan in the banking industry prior to the crisis, but that's no excuse not to show ourselves now. We have a short window in which to convince CFPB and Congress that credit unions ARE different, we ARE the Black Swan, and all financial institutions are not alike. Therefore, "one-size fits all" regulations do NOT serve the public's best interest.
See told you he had good sense....
Probably can even spell grammar...
Credit Unions and communiyy banks are different than big banks and both cant get arrested on capital hill but waste millions on 4 inept trade associations while big banks will be only ones that can afford overregulation.
Definition of insanity.
Try something different. Just for fun.
How can credit unions claim to have not contributed to the mortgage meltdown when so many encouraged members to borrow up to 100% LTV or more against their mortgages to fund things like vacations and new cars? Wasn't that lack of equity part of the problem? I remember writing CU marketing copy back in the 80s, when all pitches for HELOCs included a stern warning that borrowing against your home could have negative consequences. That stopped 10-15 years ago and I haven't seen anything like that since. I realize taking part of the blame won't get CUs anywhere on Capitol Hill, but to claim the industry had nothing at all whatsoever to do with the housing bust is disingenuous, IMO.
Think CU "guilt" is so far down the totem pole in terms of significance in the financial collapse as to be irrelevant....
Have you noticed that Navy Fed has come under fire recently for its 100% mortgage program (WAPO, Keith Leggett, and CUTimes)?
For the record and from decades of experience can accurately state that 100% financing is not "correlated" to default in prudently underwritten mortgages... despite what the theorists might say !
And, more importantly: THINK NAVY FED"S 100% MORTGAGE IS THE EPITOME OF A CU BLACK SWAN !!!!.....terrific example of how CUs are different !!! Certainly salute Navy's effort !!!
Do enlisted military still face the brig if they default on debt? Talk about your rock-solid underwriting ...
Heather,
Good question, don't know the answer; but having a son just out of the Marines can confirm that young "20-somethings", generally single, generally male, generally "not wealthy"... don't "generally" have a clue about finance!
Would trust the troops to any CU over what they are exposed to just outside the gate to the base...
And, if the "default to the brig" rule still applies, assume the auto finance predators and payday shops receive "equal protection"...
Agree?
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