Unauthorized Withdrawals.... Helmet Heads

"I would like to request
a cash advance..."

When working for a financial institution, the occasional "hold-up" is one of the professional facts of life we all encounter. Fortunately credit union robberies are relatively rare events; and, although extremely frightening, are usually over quickly with little harm done. Except for... the shattered nerves and emotional roller-coaster for the staff which are always difficult and wrenching aftershocks....

We always try to make the robber understand that our goal is to provide the best, most exemplary "customer" service possible. Whatever you need the answer is "yes"; and, you will also receive the fastest, most courteous service imaginable - because we want you happily out of there as quickly as possible !! 

But, sometimes a concern over the "unprofessionalism" of the robber makes us hold our breaths.  The robber has responsibilities to live up to also, if everything is to go as it should.  We had one of those moments of doubt not too long ago in the midst of "an unauthorized withdrawal event"....

"Would you like to see
my I.D. ?"
"No, no that's OK..."

The robber came into the branch wearing a dark-shaded motorcycle helmet and displaying a silver hand gun.  He was a bit overweight; our staff froze to attention.  As he leaped over the teller counter, he accidentally dropped his pistol.  So, here we go with him on one side of the counter and his pistol on the floor on the other side of the counter....

NCUA Board: National Leadership Search...

.... reckless selection
 process?

Hope you've been thinking about the critical importance of the upcoming two vacancies on the NCUA Board.  

In the past, appointments to these seats were not principally awarded based upon ability, knowledge, nor competence. Historically, the NCUA Board seats were considered "political plum" positions to be awarded to the party faithful, quite often as a "plush capstone perk" for a not-necessarily-qualified nor gifted, career federal employee.  

Nothing can "shape up" a federal pension quite like a six-year appointment to a $150,000 position - assuming you can put up with the frequent resort travel and the Kafkaesque disdain for transparency and accountability!

But with 100 million Americans now being member-owners of credit unions, with over $1 TRILLION of hard-earned savings at stake...

... and with every "OMG" misstep being 

"backed by the full faith and credit of 

you and me!!.....

Isn't it past time for two experienced, moderate national leaders on the NCUA Board?...

"Small" Credit Unions: "Intertwined" in American Communities…?

ABA Boinkers News

I used "to sneak" access (still do!) to the ABA Bankers News for two important reasons. 

First, to try and stay attuned to the national issues - other than "those demonic credit unions"! - which were of the greatest concern to America's bankers - "know your adversaries" is generally excellent advice in the fields of business, politics, and love.  

And second, to have the chance to read the column of the then editor, Virginia Dean.  Ms. Dean was an entertaining, insightful writer with a a wicked sense of humor.  In one column, Ms. Dean did a riff off Jim Collins - the "Good to Great" guru - who was putting the finishing touches on a new book seeking to measure performance in the non-profit sector - a daunting task! Here's what Mr. Collins ended up with:   

"In the social sectors, the critical question is not, 'How much money do we make per dollar of invested capital?' but 'How effectively do we deliver on our mission and make a distinctive impact relative to our resources?'"

"The number one resource for a great social sector organization is having enough of the right people willing to commit themselves to the mission."

Collins maintains that "the right people" are "productively neurotic" and wake up every day, compulsively driven to do the best they can because it is simply part of their DNA."

Sounds about right to me!  There has been substantial back-and-forth recently on the ineffectiveness, lack of efficiency, inability to compete, idealistic "La-la land" backwardness  of "small credit unions". To which I'd like to respond to those smug little naysayers with this one simple statement…

  "You don't know how to count, nor do you know what counts."

And BTW, why do I admire Ms. Dean as a writer so much?  Here's how she describes the critical importance to Main Street America of "less than large" financial institutions ...

Political Alert: Credit Unions Drive Banks From Marketplace!

FROM THE WALL STREET JOURNAL:

(March 19, 2016)

"J.P. Morgan Culls Wealthy Herd"

"J.P. Morgan Chase & Co. is making its private bank even more private.  Clients of the firm's private bank later this year will be required to have at least $10 million in investible assets...."

The new "unbanked"?  What will these folks do now that they've lost access to affordable, "life-line banking" services at Chase? To whom can they now turn for financial help - payday lenders, title loan companies, check cashers? The "upper, upper, middle wealthy" class have been forced off Wall Street and back on to Main Street - how degrading, how humiliating!

Somebody call the Doctor
for help!

Who can doubt that this move by Chase is irrefutable evidence of the harmful results which will arise from NCUA's recently proposed field of membership rule? Further proof of the unintended consequences for "the formerly wealthy" which arise from trying to better serve the "not yet wealthy".      

Look for this move by Chase away from the "you only thought you were wealthy" class to be used by the ABA (American Boinkers Association) against credit unions on Capitol Hill 
claiming ...

Can You Count To...

... FOUR?

Southern Culture.... Election 2016!

The Senate and ...
the house.

Maybe it's a little silly to talk about "Southern Culture" when most of y'all think we're a bunch of "ruby throats".  But you really need to understand, that in the South - "down y'here"; there comes a time, when you just have to ...

Value Proposition....

"Price is what you pay, value is what you get."

- Warren Buffet

Fan/Fred Freakonomics...

Quote of the Week:

Rep. Hensarling

"When asked his view about the government's now large potential profit from the Fannie Mae and Freddie Mac takeovers of 2008; Jeb Hensarling (R-Tx), Chair of the House Financial Services Committee said:"

"If you gave me a monopoly and a printing press [with an unlimited power to print money]..."

Financial Literacy: Gen Whatever ....

These days, "Baby Boomers" can frequently be found loudly lamenting the financial insophistication of "Gen Y"!  

Bit remarkable that the BaBoom generation, which brought us trillion dollar deficits, the Great Recession, 10% unemployment, and financial innovations - like payday lending and exploding mortgages - can be so uptight about the lack of "fin lit" amongst their kids.  Let's just hope it will prove difficult for Gen Y'ers to surpass the record of financial chaos set by their parents!  

But, don't despair there appears to be much hope that Gen Y will, in time, graduate from "Whatever!" to "Why?". And, that "Gen Why?" will then become a highly positive financial force in the future.  

Had an example of Gen Y "fin ill-lit" recently with

my Gen Y son, Thomas. True to form, Thomas is "all electronic" in his finances - direct deposit, internet, funds transfer, mobile access, debit and credit cards, call center, ATMs, zap and go!!! But looking at his statements, Thomas obviously didn't "get it" about ATM usage and surcharges.  Every week there were three or four $20 withdrawals, each carrying a $2.50 bank surcharge!

"Thomas we need to have a little talk."

"Bit late on that Dad, should have had that "little talk" when I was eleven....."

Member Recognition......

Among many innovative credit unions, there's a new found affection going around for member profitability segmentation - finding out which members are "most profitable" to your non-profit cooperative (and presumably purging the rest!).   I was listening recently to a CEO who had bought into the concept "whole hawg" and was now a firmly convinced, true-believer.

The segmentation finding which really caught my eye from that Credit Union's most recent profitability analysis ( the consultant's name was Right-On or Raddish, something like that, can't remember exactly!?), revealed that a long-term Board member was "the most profitable member" of the Credit Union!  What a splendid distinction!  The highly pleased CEO, in fact, had ordered an elaborate recognition plaque to present to the Board member at the upcoming Annual Meeting.

Umm-mm-m, let's see here......

Looking To The Future...

Relatively speaking...

It doesn't take a genius to recognize that we are at a critical, decision juncture on many crucial issues - including the future of credit unions! - in this Country.

While we may not yet agree on what is needed for the future, hope we can all agree on two things we can no longer afford from the past:

NCUA Robusterians: Always Predictable.....

"Those who have knowledge, don't predict.

Those who predict, don't have knowledge."

- Lao Tzu

Nepotism...

Always been grateful that I worked for a credit union with a strong nepotism policy.  It's hard enough to maintain balance and fairness in the workplace without complicating the tension with family and relatives! 

And besides, the "Board member's son" on the staff always faces a lose/lose proposition.  If "the son of a B" fails, everybody does an "I told you so"; and if he succeeds, everybody thinks it's because "he's the son of a Board member". He just can't win!  Sometimes "life's not fair" - right? Well, it's never fair with a "nepot"!

Lots of folks (Board and management are the

worst offenders) would like to overlook the "inconvenience" of a strong nepotism policy which assumes an organization hires based on "capabilities" - which admittedly are often very subjective measures to say the least. But hey, let's not hire "friends and relatives" to make the problem even more difficult than it already is ... Ok !!!

So, a co-worker said; "Well then, how about explaining in plain English what "nepotism" really means, will you? I'm not sure I get it."  

Here's the best I can do...

Spring Weekend...

H-m-m-m....

Going To The Dogs....

"Dogs are our link to paradise.

They don't know evil, jealousy or discontent.

To sit with a dog on a glorious afternoon is to be back in Eden,

When doing nothing was not boring, 

It was peace."

- Milan Kundera

I own you!
It's not the other way around!

.... for some folks I greatly admire, who do truly love their dogs!

Ed Callahan... A Look Back

Always suspected that the problem with Ed Callahan was that as a youth he was beaten too often by Nuns in parochial school or, perhaps, not beaten enough. Well, whatever, either way the Nuns left their mark – an indomitable spirit!

Ed Callahan was Irish – brash, pugnacious, loud, hard drinking, fun loving – alive! But why be redundant? I said he was Irish!

For over a quarter of a century, we all watched and observed as Ed Callahan created shock waves in the credit union world. No one was neutral about Ed Callahan. His friends were fiercely loyal, his enemies equally committed. Ed inspired many and angered quite a few. Ed had style; he had presence. With Ed, you weren’t allowed to make contact without becoming involved, excited, immersed, engaged.

At Marquette, Ed must have played football in the same way he played life – without a helmet. You had no doubt that Ed Callahan always played for keeps. He had no intentions of losing, that was not one of the options. Ed was very straight-forward; your choices were always clear. The mission was defined; and, there was only one direct path to the goal. That path was either with you, around you, over you, under you, or through you; you could step aside or get on board. It was your choice; but your choice never changed the mission, nor the path, nor the goal.

Some said that Ed was a visionary...

A Class Act...!!!

 Miz Jane Watkins

Virginia Credit Union 
at retirement...

...  radiance, intelligence, and elegance!
Virginia's finest!

The Credit Union Regulatory Risk Formula...

"Outstanding in my Fields…."

Need a little help with your next exam response?   Well, here's the math underlying: "The Credit Union Movement Formula for Identifying Regulatory  Risk (IRR)". 

It's a simple matter of solving a series of simultaneous equations. Ready?  

It really is as easy as 1-2-3!

        
               1.    Opacity = Uncertainty.

               2.    Uncertainty = Risk.

… ipso facto …

Is Balance In Politics Possible?... Here's Proof!

It's a difficult year in Presidential politics. Lots of

invective and divisiveness. Sort of reminds me of a regulatory exam where the self-assured, self-important extremists feel no need to listen to the voices of experience, reason, and reality.

Representative Sweat

But, just in case you haven't, as yet, made your final candidate choice, I would like to recommend for your consideration, as a write-in candidate for President, Noah S. "Soggy" Sweat, Jr. a former state representative from Mississippi. Noah Sweat is a man who will not stoop to name-calling, dirty tricks, mudslinging nor muckraking. Sweat tells it like it is, as you'll see in his most famous political speech, on a topic of high importance to many Americans:

"My friends, I had not intended to discuss this controversial subject at this particular time. However, I want you to know that I do not shun controversy. On the contrary,  I will take a stand on any issue at any time, regardless of how fraught with controversy it might be. You have asked me how I feel about whiskey. All right, here is how I feel about whiskey:"

"If when you say whiskey you mean the devil's brew, the poison scourge, the bloody monster, that defiles innocence, dethrones reason, destroys the home, creates misery and poverty, yea, literally takes the bread from the mouths of little children; if you mean the evil drink that topples the Christian man and woman from the pinnacle of righteous, gracious living into the bottomless pit of degradation, and despair, and shame and helplessness, and hopelessness, then certainly I am against it."

"But, if when you say whiskey you mean the oil of conversation, the philosophic wine, the ale that is consumed when good fellows get together, that puts song in their hearts and laughter on their lips, and the warm glow of contentment in their eyes; if you mean Christmas cheer; if you mean the stimulating drink that puts the spring in the old gentleman's step on a frosty, crispy morning; if you mean the drink which enables a man to magnify his joy, and his happiness, and to forget, if only for a little while, life's great tragedies, and heartaches, and sorrows; if you mean that drink, the sale of which pours into our treasuries untold millions of dollars, which are used to provide tender care for our little crippled children, our blind, our deaf, our dumb, our pitiful aged and infirm; to build highways and hospitals and schools, then certainly I am for it."

"This is my stand. I will not retreat from it. I will not compromise."

Ready for a cold Sweat in the WH?
[We may get one!]

Hopefully you will agree that we need more political leaders like Mr. Sweat who "will not compromise" our most cherished values.  Now some of you may object to casting your ballot and potentially electing as President a man who died in 1996, but...

The Facts Of Life...

"When we are planning for posterity, we ought to remember that virtue is not hereditary."

-Thomas Paine

(Common Sense, 1776)

What We Have Here Is a Failure to...

Leadership in action...

As a "leader", when you run out  of excuses; it is always safe to blame the problem on a lack of communication or a lack of training...

Ta Da....

Fresh Air....

Ya Reckon...!?

THE POLITICS OF 2016 ?

Capital Markets Special-ist...

One, of course, does not expect folks of a regulatory mindset to be either interesting or entertaining as public speakers; and the lead-off econo-prattler did not disappoint. Many in the audience bowed their heads and wished they were somewhere else - perhaps a funeral. 


The second presenter was introduced as their capital markets "guru". Assume they called him a guru because they weren't sure how to spell charlatan, mountebank, pettifogger or punchinello, but....

Mike Tyson On Robusterian Quantitative Analysis, Capital Planning And Stress Testing...

Iraq/Afghan, Healthcare, 
Fan/Fred, Katrina,
 TBTF, QE3, RBC1...

Sir Lawrence Freedman has a new book out called "Strategy:  A History" which was recently reviewed in the Financial Times.  The review uses the following quote from "bad-to-the-bone" boxer Mike Tyson  to sum up the core insight from the book - "Everyone has a plan 'till they get punched in the mouth."

There might be an important word of caution, perhaps even of enlightenment, in Mr. Tyson's "realest of real worlds" wisdom for all our "robustly" faithful, Monday morning quarter-backs - those in-the-end, unaccountable armchair strategists. 

Here's the gist of the review...

Climbing Up The Wall....

"Make The Wall Great Again!"

Been interesting of course to watch The Great Debates of this political season, it brings to mind the famous Alfred Hitchcock movie - Psycho! 

      [very scary!]

One idea consistently put forth by Donald Trump is the proposition that the U.S. build a 10-foot wall along our Southern border to solve our "immigration problem".  And, for good measure, Mr. Trump proposes that Mexico be required to both build and pay for the wall.  

Up and Down.

Mr. Trump cites The Great Wall of China as the historical example supporting his opinion.

There appear to be four problems with Mr. Trump's proposal:


1) If the wall is built by Mexicans, wouldn't that be just another example of undocumented aliens taking American jobs?

Up and Over!

2) If  the folks in Mexico are smart enough to build a 10-foot wall, 1600 miles long; aren't they smart enough to manufacture 12-foot ladders?

Now What?

3) How far out into the Gulf of Mexico and the Pacific Ocean will the wall be extended?

"From $369+tax...!"

4) How much is the airfare from Mexico City to Canada? Bet Mexicans know how to walk south as well as north.... 

Beau Jolly ....

"At first, I did not care for the wine,
 but it improved after a few bottles."

The Cat's Me "Ow" !!! ....

Wait a minute, come back here!
What did you say?

" Never corner anything meaner than you are."

Nothing Matches Experience..

"Experience" often comes
without instructions!

" Good judgment comes from experience;

 most experience comes from bad judgment."

The Moral Of The Story...

The Maine Idea!

"The right way is not always the popular and easy way.  Standing for right when it is unpopular is a true test of moral character."

- Senator Margaret Chase Smith (R-Me.)

Senator Smith also said...

A Refreshing Look At Risk....

Big Ben !

Spent some time a couple of months back at a Federal Reserve Bank of Atlanta (FRBA) sponsored Financial Markets Conference. Know most of you will find it highly unlikely or hilarious, but it was quite an enlightening experience.  

Had some legendary folks in economics in attendance, including Ben Bernanke. Amazingly security was very light; guess no one in his right mind would knowingly try to "break into" an economics conference; and the last group you would ever want to hold hostage would be a group of economic theorists (talk about cruel and unusual punishment !).

There is certainly a profound world of difference between listening to some seriously serious folks discuss stress testing, interest rate risk, and the issues surrounding the future regulation of the financial industry, and in what most credit unions hear from our examiners.  The chief differences are the readily expressed uncertainty by the experts as to the best way forward for regulation in this difficult economic environment; the readily acknowledged weaknesses, flaws, and limitations in all the standard economic risk measurement models; and the readily expressed need for regulatory humility and an openness to dialogue in the face of a rapidly changing economic risk
environment. Highly encouraging, very refreshing !! 

Risk Analysis & Calibration - 
Duke Street Approach !!

Much different from the "tone and tenor" in the credit union regulatory space.

Did hear one anecdote about the major bank boss who, after the financial collapse of 2008,
stormed into his economic/capital markets division and fired the whole group outright.

When they expressed shock and surprise, he pointed out...