1. When Banks Compete, You Lose!
2. When Banks Compete, You’re Screwed!
3. When Banks Compete, You bail them out with over 1-trillion dollars in taxpayer money.

Do you remember all the Lending Tree commercials leading up to today’s banking crisis? They had a catchy saying, “When Banks Compete, You Win”. I was curious if they chucked that slogan after the financial melt down. After all, many of the problems we’re experiencing today were a result of banks competing for customers who could never afford a house in the first place.

I’ve been reading articles lately that explained the creative financing options offered by banks. I read of one financing option that required $0 down and the payments were so low that the amount that they owed on the house actually increased each month! Don’t ask me how that’s possible. And this one takes the cake: How could a strawberry picker earning $15,000 a year qualify for every penny of a $720,000 mortgage? Unbelievable!

I’ve been strongly against the bail out since its conception and I think congress made a lapse-of-judgment by getting so involved in Wall Street. It violates my sense of justice. If a corporate entity makes bad business decisions, it should seek bankruptcy. That way, the impact of the fall is absorbed by shareholders and those directly involved in the situation, the high-level executives who made the bad decisions will be replaced, and the entity will emerge leaner with a clean balance sheet.

I have my theory behind the root of banking meltdown. I think it stemmed from greed. What do you think?