ANZ and Westpac bank buildings on an appropriately drizzly day in central Adelaide, by Dodge 76 on Flickr
ABC News is reporting Aussie banks are taking advantage of vulnerable consumers. And you know what my first reaction was? I questioned whether they were also going to tell me the sky is blue, you need oxygen to live and grilled cheese sandwiches are generally made with bread. It's sad our financial systems around the world have become such… I'm trying to think of a word that's less harsh than "cesspools" but has more bite than "meanie companies".
I know my writing this here won't make a lick of difference, but it's time to throw out Thatcherism, Reaganism and it's derivatives that define all regulation as burdens to capitalism and dampners on growth, and regulate the crap out of these guys! The regulations have to make sense; mindless red tape doesn't get us anywhere; but conversely no regulations are not the answer. We need some serious checks, balances (terrible financial puns) and oversight on these guys. And it needs to be done globally.
If we've learned anything from this financial crisis, it's that banks and other large financial institutions cannot be socially or financially responsible by regulating themselves. It didn't work in the 1920s, and it ain't working now.
As for the article about Australian banks? I remember discussing a similar case with a conservative guy on Twitter when the subprime mortgage crisis was first rumbling in the United States. He claimed liberals (American not Australian sense) were to blame for it because they had the gall to want affordable housing for people, which in turn led to unrealistic loans being given out to people who couldn't afford it. It's interesting how predatory lending, extortion and and blatant exploitation of the most vulnerable people in our society can be twisted to be entirely their fault. I would think even from a conservative standpoint this argument wouldn't make sense.
And to think banks around the world are receiving tax dollars to stay viable, only to pull stunts like this on decent people, some of whom perhaps need education in fiscal prudence and management but who nevertheless don't deserve this treatment. It generates some resentment in me, but mostly it just makes me… sad.
Banks are being accused of exploiting their most vulnerable customers by offering them credit they cannot afford.
Many face bankruptcy with no prospect of paying down debts totalling tens of thousands of dollars and banks are being accused of taking advantage of them during the boom via direct marketing campaigns.
Chris Gration from credit reporting group Veda Advantage says those in the greatest financial trouble are the ones most likely to take up an offer.
NAB says it is winding back its direct mail campaigns and Westpac is doing the same.
But the CBA and ANZ continue to direct market at the same levels they did 12 months ago.