I agreeto Idea Be the Bank of 2nd Resort
Voting is Disabled

-17 votes

I disagree

Rank30737

Idea#1377

This idea is active.
Public-Private Partnerships »

Be the Bank of 2nd Resort

Why Is This Idea Important?: Business could return to normal as it had access to the credit it deserved again. Customers who could afford to buy houses would be able to get the loans they need to buy them thereby improving the housing market.

This should have happened when the government took over WAMU but there will be more opportunities with other big banks that are still floundering out there. When the next big bank fails turn it into a true National Bank(providing the new bank with accessible branches). Part of the stimulus money would be used to make it solvent. Once it's up an running it should offer credit to qualified customers/buisnesses at a rate that's half of a point higher than the best run banks are offerring. This would almost immediately ease the credit crunch. Banks that weren't well run would fail as they should. Their depositors could then either go to one of the better run banks or do their banking at the National Bank. By keeping the interest rate slightly higher than the good banks are offering it wouldn't drive the good banks out of business. It would however encourage them to take a closer look at potential customers so they could grab the good ones and make some money instead of letting them fall through the cracks to the National Bank.

Tags:

Submitted by longshot9999 2 years ago

Vote Activity Show

Comments (1)

  1. mAximo

    This is already done by the Government Development Bank in Puerto Rico which also used its power to forbid subprime mortgages.

    We should do to the Fed what happened to our 1st private central bank: go into competition with it, when State banks were chartered to compete with the Bank of North America. The BoND is a modern version - the DBA name for the State of ND - but the Constitution prohibits it from emitting dollar bills, and coining money, so it is required to get Congress to do so for it via their own banks, one of which has already been chartered in Puerto Rico: The Government Development Bank, so we don't have to wait for them to recharter the Reconstruction Development Bank in DC. Such banks in federal territories are constitutional pursuant to Art.4 Sec.3, and necessary to implement federal monetary policsy and for State banks to create greenbacks - neither should be in the hands of a private Fed, who should remain in business, but only to run the system "evolved" by private national banks.

    2 years ago
    0
    0