You must not have gotten any notices that your bank fees and credit card rates were going up after TARP was initiated.
The losses from the bad players should have been taken. instead we’ve misallocated a massive sum of money to keep the TBTF banks alive.
I don't pay any fees and haven't carried a credit card balance in years.
The losses from the bad players should have been taken.
Banks lost billions.
Fees and rates have absolutely nothing to do with TARP. For the real culprit of higher fees and charges and reduction in free services look at the Dodd-Frank "financial reform" passed last year. It put many regulations intentionally and specifically designed to cut profit of banks and many other financial institutions and financial services providers.
It also established the Consumer Financial Protection Agency, embedded into the Federal Reserve so it would be unaccountable to Congress, chaired by famous crusader and foe of banks, credit card companies, and capitalism in general (and participant in Michael Moore movies and other anti-credit "mokumentaries") - Elizabeth Warren.
As part of new law and regulations the Fed had to propose Draconian cuts in debit card fees, which may cut as much as $80B worth of credit from the economy annually, private investment services including trading, derivatives and other "free" or inexpensive services that used to be part of banks' profit...
As usual, and as was expected, the banks have to make up for the lost profit somewhere else, which in this case would be you, the customer - the same one that Dodd-Frank was ostensibly passed to protect from the "evil" banks.
In case you haven't been following this (sounds like you haven't), here are some links and excerpts:
From $5 Fees May Be Coming to an ATM Near You - CNBC, 2011 March 31
J.P. Morgan Chase and other banks are trying to recoup approximately $30 billion a year in lost overdraft fee income by testing $5 ATM fees, Consumer Action spokesman Joe Ridout told CNBC. These banks have "historically been reliant on overdraft fees," he said, so they're "coming up with new ways to make up the difference." He said higher ATM fees and other rising costs penalize small depositors. Nessa Feddis, spokeswoman with the American College of Consumer Financial Services, agreed there are "enormous pressures on banks because of lost revenue." ..... < snip >
From JPMorgan's Dimon Warns of Regulatory 'Nail' in Coffin - CNBC / FT, 2011 March 31
..... On Tuesday, Alan Greenspan, the former Federal Reserve chairman, wrote in the Financial Times that the Dodd-Frank financial reforms risked creating "the largest regulatory-induced market distortion since America's ill-fated imposition of wage and price controls in 1971". ..... < snip > ..... John Tester, Democratic senator from Montana, has closed in on the 60 votes he needs to overturn the rule. He was supported on Wednesday by Mr. Dimon who called it "basic price fixing at its worst". ..... < snip > ..... Attacking another aspect of Dodd-Frank, Mr. Dimon said rules requiring companies to put up collateral as they trade derivatives would "damage America". Gesturing at the chief executive of Caterpillar , Mr. Dimon predicted the industrial company would take its derivatives business to Singapore. He said the new law had failed to improve the regulatory architecture. "We had a system of too many regulators, too much overlap and too many gaps. Instead of simplifying and strengthening, we added more. It's even more complicated now." ..... < snip > Jamie Dimon, chief executive of JPMorgan Chase, launched a broadside against financial regulation on Wednesday, warning that new capital rules could be "the nail in our coffin for big American banks." ..... < snip >
Wells Fargo Halts Enrollment in Debit-Card Rewards, Citing New U.S. Rules - BL, by Dakin Campbell - 2011 March 25
From US Debit Fee Caps May Hurt Poorest Customers: Dimon - FR / Reuters via CNBC, posted by CutePuppy, 2011 January 14 (you've been warned)
The rules, proposed as part of the Dodd-Frank financial reform law, would cap the fees that merchants pay banks for processing debit card transactions at 12 cents each. That is almost 75 percent less than the average 44 cents per transaction that banks get now. ..... Federal limits on debit card processing fees will force banks to charge customers more for services, making accounts too expensive for as many as 5 percent of customers, JPMorgan Chase & Co's chief executive said on Friday.
Here's Barney Frank to the rescue!
If Big Banks Raise Fees, Bank Elsewhere: Rep. Frank - CNBC, by Michelle Lodge, 2011 March 25
Should big banks jack up fees, Rep. Barney Frank, (D-Mass.), told CNBC Friday, he would urge bank customers to shop around and find community banks and credit unions that offer services for free. ..... < snip >
Don't worry, the Democrats will find a way to "protect" you again from the "evil bankers" who obviously exploited some "loopholes" in the "good-for-you" Dodd-Frank Financial "Reform" Act.
The biggest reason fees and rates went up is that ridiculous financial regulation bill passed last year.
Fee changes from the big banks were prompted by FinReg, which made it so the majority of small consumer accounts were unprofitable without increases to fees. It had nothing to do with TARP. Like any business, banks are in it to make money. Price controls from Congress don’t save anyone money in the long run, especially the consumer.
If you want to know how these banks were able to repay TARP, take note of the massive stock offerings that have occurred over the last two years. Shareholders paid off TARP, not consumers.