TheAgitator.com
Northern Trust Gives Back Bailout Money
Saturday, February 28th, 2009It’s money that they never requested in the first place, but the TMZ expose of their lavish parties in L.A. apparrently spurred the bank to hand back the cash.
Some of you chastised me for criticizing Northern Trust in my prior post on this story. I should have been more clear. I don’t really care how Northern Trust spends its own money. If swanky parties in L.A. for clients and employees have helped the company’s bottom line (and that may well be the case–the bank doesn’t appear to be in any trouble), then by all means, live it up.
But when Hank Paulson & company were making the case for the bailout, I doubt most taxpayers envisioned government-backed loans going to high-end banks who sponsor lavish parties with Tiffany gift bags, Sheryl Crow, and Earth, Wind & Fire. Again, I wasn’t clear enough, but my animus here is directed at the government for forking over $1.5 billion to a bank in good financial shape that caters to the sort of clientele where glitzy parties are part of the business plan.
Dang Radley, I wanna be a ROCKSTAR!
Why is it that banks always seem give money to people who DON’T need it? I’m still trying to fathom that one.
Let me go way out on a limb here, but I’ll go as far as to bet that nameless, faceless, homeless lady with children to feed who’s lost her job would appreciate the money it cost for ONE of those ‘goody bags’ the celebrities get.
They’re giving the banks money, but the banks aren’t lowering any interest rates that I know of and none of them have invited me to any of their damned parties either.
Geez…maybe it’s my breath…ya think?
“I don’t really care how Northern Trust spends its own money”
Right on.
Giving back the bailout money seems to be a good PR move. Even the parties might be good. If they can do all that , it must be a safer place than others to put your money right?
NT is a great place to put your money, if they’ll have you. When they say “subprime” they mean “only seven figures.”
“But when Hank Paulson & company were making the case for the bailout, I doubt most taxpayers envisioned government-backed loans going to high-end banks who sponsor lavish parties with Tiffany gift bags, Sheryl Crow, and Earth, Wind & Fire.”
I did. I didn’t figure the high-living Masters of the Universe were going to change their tune just because they drove their companies into the ground. Why should they when they can now get us to foot the bill?
I am actually somewhat heartened by Northern Trust’s actions. Ideally, instead of sending a nicely-worded letter to the honorable Chairman Fife Frank, they should have told him to go regulate himself and the high horse he rode in on. But you can only expect so much honesty against a lackwitted lummox like the federal government, what with its tendency to do bad things under normal circumstances and worse things when it’s excited.
If NT had retail banks near me, I would consider jumping ship. As it stands, I do most of my retail banking through Citibank and I am not at all happy about having any money in a government-owned bank. Nothing shakes my confidence in a financial institution like it being run by the same economic bumblers who show no grasp of basic supply and demand, consistently fail to follow their own rules, lie to their customers, maintain books that would get anyone else thrown in jail, and bleed money like a hemophiliac at a vampire convention.
If the scariest nine words in the English language are “We’re from the government and we’re here to help”, then the financial equivalent is “We’re from the government and we’re running your bank.”
This is the first useful thing TMZ has ever done.
So when will Northern Trust get the army of bank auditors looking for violations of the CRA? That was the threat handed to BB&T when they tried to turn down the bailout money at the start of this entire mess.
#5 Might I suggest that you investigate what credit unions you are eligible for in you neighborhood.
Whoever accepts gov’t bailout money should expect their spending habits to be scrutinized. Who among us reserves judgment when some single mom ahead of us in line at the super market buys a cart full of junk food with food stamps? Who doesn’t want to give her a lecture about nutrition and budgeting?
I think the real crime is that the bank spent all this money and hired Chicago and Earth, Wind & Fire.
What is this ridiculous panic coming to? Is the world supposed to stand still and banks stop all marketing efforts, even if they are already contracturally obligated to them?
We want to stimulate the economy. How? Spending, that’s how. Where do these bone heads in Washington think the money for this event went. Let’s think, limo drivers, cooks, waiters, waitresses, maintenance people, guys who set up the tents. Politics has overriden the real story as all these beauracrats play for attention.
Hooray for Northern trust.
If they could afford to give the money back, why did they take it in the first place?
CA will never give any of the money back. They’ll just throw it into that bottomless pit of greed and overspending and raise our sale’s tax to 9%. Governator needs to step down. I digress. This isn’t about CA. Kudos for any firm or organization who actually does the right thing; unlike AIG who went on a vacation after Bush’s first bailout round, only to lose 60 Billion more this quarter alone. Yep, just keep throwing money at it. It’ll work eventually, right?
Lloyd beat me to it. How many of the libertarians who chastized you for criticizing Northern Trust would have reacted similarly to your criticism of a food stamp recipient’s grocery selections?
Yet another illustration of the general principle that welfare for the rich is kinda sorta bad, I guess, and we maybe oughta do something about it someday, I suppose–but welfare for the poor is flaming red ruin on wheels.
To David #12
They probably took the money because they were forced to. The Fed’s walked into Wells Fargo, the only AAA rated bank in America and said take the money. Wells did not want to. Our friends from DC said take it don’t ever call us if you have a problem in the future.
They aren’t alone. TCF told the fed’s they want out because they didn’t want to deal with all the regulation surronding TARP.
http://www.startribune.com/business/40562962.html?elr=KArksLckD8EQDUoaEyqyP4O:DW3ckUiD3aPc:_Yyc:aUac8HEaDiaMDCinchO7DU
Norther Trust did nothing wrong here. The logic of the bailout, as awful as it was, was that every bank would get something that way nobody could spot the bad banks and dump their stocks, and thus, so the thinking goes, worsen the crisis. People who think Northern Trust did something wrong are just revelling in their own ignorance of the situation or are deliberately misusing the situation for thier own agenda. The first is sad, the latter is despicable.
Note, I’m not defending the bailout, but I’m pointing out the foolishness of jumping on Northern Trust.
Judi,
Epic fail here. You really think that appeals to emotion are going to work. Lets think. A bank, which is a for profit entity and has a legal and moral obligation to pursue profit on behalf of its share holders is not going to make money by lending money to a woman who is so down on her luck. In fact, doing so would make the situation worse since she’d have no means to pay back the loan and that would likely mean a black mark on her credit history. That could prevent getting a job down the road as well as obtaining credit when her luck does turn around.
What you are asking for is charity, and you don’t give charity by making loans to people who can’t pay them back. In fact, that is one reason we are in this mess. We are partly in this mess because various lending organizations went out and lended to people who cannot pay back their loans and are now defaulting on said loans.
Actually the way it is is that she is probably buying that with her own money. Food stamps usually work for milk, butter, various cereal and juice products, not junk food. However, since the foodstamps free up money that might have been spent on those items the single mom can now put in the junk food items.
Northern Trust is part of the Federal Reserve System. It’s really quite hard to say what of its money is “it’s own”.