Postal at the Bank
Minor altercation at the bank today. I was in a long line looking to
cash some checks. I happened to notice a lady talking to a loan guy in a
cubicle across the way. It was clear, even from a distance, she was not
happy with the way the conversation was going. She gets up and the
banker comes out with her. She turns to him and says in a voice that was
deliberately loud enough for all to hear:
“I wanna know. Just who’s dick do I have to suck to get a loan? Can you tell me that?”
You could’ve heard a pin drop for a second or two. The banker looked
like he’d been hit with a shovel. A red-faced manager comes out of a
hole and leads the lady out. It’s over in seconds.
Half the people start laughing. The other half don’t know what to make
of it. I am watching this bit of drama and I am thinking of shorting
bank stocks and what a bizarre world we live in.
Banks aren’t really making any loans. They are doing their very best to
avoid that pitfall. It is much easier for them to buy securities with a
fixed coupon from big cap multinationals, bankrupt government guaranteed
agencies and of course the Treasury Department. The banks are having an
easy time of it. With ZIRP as their ally they can just ride the yield
curve. No need for complicated loans. No wonder America is hating its
-The equity markets are soaring and so is gold. An unlikely outcome. One
market is the measure of optimism the other is the best "smell test" of
the collective fear of the future.
-Banks aren’t lending, but they are making a bundle.
-The economy has recovered to a significant extent. We will not get back
to the growth and 5% unemployment we had three years ago. The emergency
is clearly over both in the US and overseas. But the Federal Reserve is
about to start a meeting that will set in motion another multi-trillion
None of these things (including people going postal at the bank) make
sense to me. The sum of all of these pieces takes me one place.