Monday, June 16, 2008

Waking up to Reality

I'm sure this is going to make some folks mad, especially people in certain 'industries', however I just can't seem to contain myself.

How many times have you seen that hogwash on TV about this bank, or that bank, doing you some 'great service'? Did you fall for it 'hook, line, and sinker'? That's a shame if you did. Really a shame. Let me explain why I feel that way.

First off, I use direct deposit to have my salary sent to X Institution. For all accounts and purposes, I am making a loan to X until I'm ready to use those funds. What has X provided me? A safe place to keep my money, a debit card and checks so I can withdraw it to pay my bills or purchase something.

What I have done for them was loan them my entire paycheck to use, until I need it. So during the course of the year I have loaned them, say $30,000 (fictional sum used). What have they done with that money while they had use of it? Made more money by loaning it to someone else. What portion of the interest that they collect is given back to me? Zilch, zip, nada.

Now lets take a nice round figure to represent the number of 'customers' the bank has who are doing the same as me. Say 100,000 (it's just a small bank, okay?) So these 100,000 customers donate on average (just for simplicity's sake) $1,500 a month in X Institution. That is a whopping $150 million dollars each month, or $1.8 billion a year. If I had that kind of money coming in yearly, I'm sure I could make some money on that, take a trip, buy a new home or two, several new cars, etc...and that's just on the interest, not on the principal.

So who's getting the most benefit out of the money we are working for?

Just something else to think about.

Have a spiffy week!

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