Bank Failures: Sign of Economic Improvement?

Here are some interesting statistics:
Bank Failures in the USA - 2007 = 3 / 2008 = 25 / 2009 = 140 / 2010 1st 4 months = 50, total for year expected to exceed 2009 total.

BUT - we are told that the economy is making an unexpected recovery (???) The bank failures do not mean that banks are going out of business; their assets are being assumed by larger banks under deals arranged through the Federal Deposit Insurance Commission. The FDIC itself is reportedly losing millions, if not billions, of dollars.

So what we have is a further consolidation of banking power where local and regional banks are being absorbed by multi-state banks which in turn are being tightly controlled by the FDIC as part of the deal.

From sources of which I am aware, small business loans are still extremely difficult to secure with the result that many small businesses are failing. The age of the family run businesses is almost over - unless you are connected to a national franchise operation where your business is still controlled by the larger organization. Your money; their rules.

The trend is obvious: a tightly controlled economy where only a select few are allowed to participate. Even then the government frequently reminds us that we are their servants - even the mighty, such as Goldman-Sachs, is coming under investigation. However, the major players who helped to create the crisis are no longer there - the replacement team is now getting all the heat.

The result will be an enormous government bureaucracy that will be insensitive to individual situations and quick to penalize the working class for breaking rules of which we are not aware.

What is that you just said? We are already there! OMG - that was quick.

not sure if its a economic recovery, but moreso a economic restructuring of our financial system.

The overall effect of this restructuring may be a good thing if with each bank body dead, a effective system of safe trade is established.

I guess its all about the long term effects...we have been going down a rocky road for awhile now, and if we need to continue on in some sort of half hell society for a year or two more to sort this mess out, then thats what we should do for long term stability...even if the quick fix would feel good at this point.

Good analysis. Robert Reich (BLS Sec under Clinton) has a book, Supercapitalism, in which the big gov bureaucracy was in the 50s and 60s. It was actually more of a technocratic oligopoly but now we entering a new completely new realm in which national markets must compete globally.
I agree that we are witnessing massive agglomerations and weighing the FDIC it, for me, points to a highly centralized and controlled economy.
Apart from the Glen Beck hype, I would say we are moving in that direction of communism- the centralization of the economy. 5 year plan stuff.

No the 9 some odd percent unemployment is a sign of the economic recovery. We ought to be on the road to full recovery as soon as we it 12%

That's like saying that smoking a cigarette is a sign of quitting.

Orwellian double-speak at its finest.

reply to post by PsyOpCyclops


Or Bush saying he had to abandon the free market principles to save the free market.