Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP Posting-Version: $Revision: 1.6.2.16 $; site inmet.UUCP Path: utzoo!lsuc!watmath!clyde!burl!ulysses!gamma!epsilon!zeta!sabre!petrus!bellcore!decvax!inmet!nrh From: nrh@inmet.UUCP Newsgroups: net.politics.theory Subject: Re: capitalism vs. democracy??? Message-ID: <28200393@inmet.UUCP> Date: Sun, 15-Dec-85 22:43:00 EST Article-I.D.: inmet.28200393 Posted: Sun Dec 15 22:43:00 1985 Date-Received: Wed, 18-Dec-85 19:51:25 EST References: <286@frog.UUCP> Lines: 79 Nf-ID: #R:frog:-28600:inmet:28200393:000:3915 Nf-From: inmet!nrh Dec 15 22:43:00 1985 >/* Written 12:45 pm Dec 13, 1985 by berman@psuvax1 in inmet:net.politics.t */ > >Power of banks: forcing people to do what they do not want to do. >Example: you want to borrow from us, you must deposit here (my >personal experience). Omigosh! What a huge amount of power: to trade with you only on terms they find agreeable! (Of course, YOU must also find the terms agreeable). Oh woe! It's quite true that the banks have a power to deny you a loan, but they can't "force" you to do things you don't want to do unless at some point you agree to this, or, of course, if the government backs them up. >Imagine that there is no regulations. Then you might have: you >want to borrow, deposit here, insure here, use us as a brocker. >Or worse: we do not like you, we will recommend everybody not >to borrow you. Such tactics work sometimes -- and sometimes not. Would you like to know where it's used a lot around here? Bless you Piotr! The GOVERNMENT operates in this way: if you're an ex-con, or have a dishonorable discharge from the military, you do indeed have a black mark against you. Know something else? There are programs specifically designed to give folks like that a chance.... >Example two: you do not want a financial chaos, help us (and pay >taxes to do it). Oho! A government goes to a bank and offers to pay more money back later in exchange for a quantity of money today. The bank agrees. The government, likely through incompetence or lack of nerve, FAILS to meet the deadlines. In the world of individuals, suppose you took out a loan and then went on a trip around the world, not using the money in any wise way. At the end of the year, you're in the same shape as this third world government. In EITHER case, the bank involved would be justified in exercising whatever non-payment clause there was in your loan when you refused to pay. In either case, if you could convince them that you were going to change your way of using money, but just needed some more to get back on your feet, you might be able to convince the bank to give you more. In either case, the bank might insist on a little more control of how you use the money, and in either case, the bank would be perfectly justified in so doing. >Depriving you of an asset you use (like a house) may be quite a >punishment. Unregulated power of banks could be very destructive. I suppose you'll find this tough to believe, but the ungrateful S.O.B.'s that run the movie theater nearby have just stopped showing a movie I liked. Further, even when they were running it, they insisted I *pay* them when I saw it! Oh the injustice! Oh the enormous power they wield! But wait! What about that "convenience" store right next door? They have the godawful nerve to charge MORE than the huge supermarket at the foot of the hill, thus FORCING me to pay more (unless, I suppose somebody might point out, I go to the supermarket). Piotr, get it straight: you can prevent any bank from gaining undue influence over you by making sure that a) You are willing and able to make the payments, and b) The other terms of the loan don't discommode you. and not taking the loan unless you are satisfied on counts a & b. I've no patience with Snidely Whiplash, but you rarely find Snidely Whiplash in the real world. It's a SHAME that folks sometimes can't make their interest payments, and it's also sad when nations can't. But let's hear no moaning about the power the banks wield: it's power given to them by their borrowers, and if that degree of power is unjust, let's have a closer look at the borrowers, shall we? It's not that the banks are complete nice-guys, or that any consequence of a credit shutoff is deserved (what about children born during a loan-induced boom who suffer during a collection- induced bust, for example?) but merely that the power stems not from the banks but from the borrowers.