September2009

ExecutiveSummary
ItsbeenayearsincetheLehmanBrotherscollapsesetoffaflurryofbankfailuresandnear failures,threateningtheveryfoundationsoftheglobalfinancialsystemandbringingour nationaleconomytothebrinkofasecondGreatDepression.Taxpayerssteppedinandbailed outtheailingbanksinordertoresuscitatethelargereconomyandgetmoneyflowingtoMain Streetagain.Ayearlaterwewonderwhatwehavegottenforthatinvestment.Whileordinary Americansarestillstrugglingtostayafloat,thebankersarebacktobusinessasusual,paying outbillionsinbonuses,makingprofitsonthebacksoftheverytaxpayerswhobailedthemout, andthrowinguproadblockstomeaningfulregulatoryreformthatwouldpreventarepeatof thecrisis.

Whatdidwegetoverthelastyear?

1.TaxpayerBailout.Taxpayershavecommitted$4.7trilliontothefinancialsectoroverthe lastyear,only$700billionofwhichwasthroughTARP.EvenbankslikeGoldmanSachsthat returnedtheirTARPfundsearlierthisyearcontinuetobenefitfromotherbailoutprograms, suchasthe$12.9billionthatGoldmanreceivedasanAIGcounterpartythatitwillneverhave topayback.Onceallcrisisrelatedprogramsarefactoredin,taxpayerscouldbeonthehook foragrandtotalofupto$17.8trillionforthiseconomicrescue. 2.TrillionsofDollarsinLostWealthforOrdinaryAmericans.Thebankinducedeconomic crisishascostAmericanstrillionsofdollarsalready,ontopofthetrillionsmorewehave committedthroughthebailouts. Americanfamilieslost$11trillioninwealthin2008,nearly18%oftheirnetworth. Americanshavelost$6.1trillioninhomeownerwealthsinceJune2006. Bankshavegenerallyrefusedtomodifymortgagestohelppreventforeclosuresbecause itismoreprofitableforthemtocollectfeesasafamilylosesitshomethanitistosave thehome. Over5.3millionAmericanshavelosttheirjobssincelastSeptember,andthenational unemploymentrateisatitshighestin26years. Personalbankruptciesaresoaring,andareexpectedtoreachlevelsnotseensincea 2005lawmadeitmoredifficulttofilebankruptcy. BetweenOctober2007andDecember2008,thetop1,000USpensionfundslost$1.75 trillion,or23.3%oftheirvalue,theworstlossesin30years. Decliningpropertyvaluesandpersonalincomehavetakentheirtollsonstateandlocal budgets,leadingtocutsinessentialserviceslikepublichealthprograms,childhood education,andprogramsfortheelderlyanddisabled.

3.BacktoGreed&BusinessasUsual.Whiletaxpayersarestillsuffering,thebigbanksare backtobusinessasusual,payingouttensofbillionsinbonuses,makingtensofbillionsin profitsonthebacksofAmericanconsumers,andreturningtothesamekindsofpracticesthat causedthecrisisinthefirstplace.

Thenationstopsixbankspaidout$31.2billionin2008bonusesthispastwinter,andin thefirsthalfof2009alone,theysetasideanother$74.4billionforbonusesand compensationfortheiremployees. Thetopsixbanksposted$29.6billioninprofitsinthefirsthalfof2009,justmonths afteraccepting$160billionindirectTARPinfusions. Thebanksmadethesehandsomeprofitsbyembracingthesamekindofexcessiverisk takingthatcausedthecrisisinthefirstplace:bytradinghighlycomplexderivatives,by repackagingmortgagebackedsecurities,andbymakingpredatoryloanstolowincome, highriskconsumerswhotypicallycannotaffordtopaythemback. Risingfeesalsocontributedtothebanksbottomline.Americanswillpaymorethan $38billioninoverdraftfeesalonein2009,morethan$125foreveryman,woman,and childintheUnitedStates. BanksalsoraisedcreditcardinterestratesonAmericanconsumersinanefforttoboost theirprofitsbeforethenewcreditcardreformstakeeffectnextyear.

4.BanksStandingintheWayofReform.Despitetakingtrillionsinbailouts,thebanksarenow usingourmoneytolobbyagainstreformsthatwouldprotectusfromtheirabuses.Inthenine monthsfollowingthebailout,companiesinthefinancial,insurance,andrealestatesector spent$321millionlobbyingagainstfederalreformssuchasthecreationoftheConsumer FinancialProtectionAgency,limitsonbonuses,overdraftfeeregulation,creditcardreform, loanmodificationproposalsthatcouldhelpkeepmillionsofAmericansintheirhomes,anda banonpaydaylending.

Evenastheycontinuelendingtolargecorporationsandprivateequityfirms,thebanks havedrasticallyreducedtheirsmallbusinesslending.LendingthroughtheSBAsmain programdecreased42%overthepreviousyearinthefirstsevenmonthsfollowingthe bailout.

Thisisnotwhatwesignedupfor!

ItsTimeforaRealEconomicRecovery.AsWallStreetcelebratesgreenshootsinthe economyandpointstosignsofrecovery,itfeellikedjvu.Themarketwascelebratingsigns ofrecoverylastyeartoo,justmonthsbeforetheLehmanBrotherscollapse.Meanwhile,Main Streetisstillhurting.Wedontneedbankerstryingtoconvinceusthathappydaysarehere again.Weneedrealregulatoryreformnowsothatwecanhavearealeconomicrecoveryon MainStreet. ItistimeforthebankstostartaidinginAmericaseconomicrecovery.Thebanksneedto: 1. StopforeclosuresandsaveAmericanshomesandstateandlocalbudgets; 2. Providethesameaffordableloanstostateandlocalgovernmentsthatbanksreceive fromthefederalgovernment; 3. Restoresmallbusinesslendingtosavejobsandtaxrevenue;and 4. Lowerinterestratesonconsumercreditcardsandstopchargingabusiveoverdraftfees thattakebillionsoutofconsumerspockets.

Ayearago,LehmanBrotherscollapseshookWallStreettoitscoreandsetoffaneconomic crisisthatthreatenedthefoundationsoftheentireglobalfinancialsystem.Intheflurryofbank failuresandnearfailuresthatfollowed,householdnameslikeMerrillLynch,Washington Mutual,andWachoviaeitherdisappearedorgotswallowedupbycompetitors.Withinaweek, therewerenomorebig,independentinvestmentbanksonWallStreet.1 Asbankersacrossthecountrywerefightingfortheirlives,taxpayersthrewthemalifeline.We steppedinandbailedoutWallStreettothetuneoftrillionsofdollarsbecauseweweretoldit wasnecessarytoresuscitatetheeconomy.TheTreasuryDepartmenttoldusthatbankswould usetaxpayerdollarstomodifymortgagestohelpworkingfamiliesstayintheirhomesand resumelendingtosmallbusinessesinordertostemrisingunemploymentratesandstimulate theeconomy.

Oneyearlater,whathavethebailoutsgottenus?Whiletopbankersarecontinuingtomake billionsofdollarsinbonuses,noneofthepromisesmadetotheAmericanpeoplehavebeen honored.Familiescontinuetofacerisingforeclosures,risingunemployment,highercreditcard interestrates,higheroverdraftfees,androadblockstorealfinancialreformthatwouldprotect usfromarepeatofthesamecrisisinthefuture.Ourpensionfundsareinfreefall, unemploymentisskyrocketing,andpersonalbankruptciesareonpacetosetarecordforthe yearsafterthepassageofthenewbankruptcylawin2005. Someofthebigbanksclaimthattheyareprofitableagain.Theyarerakingintensofbillionsin profitsandpayingouttensofbillionsinbonuses.However,theyreturnedtoprofitability throughthesameoldtricksbytakingonevenmoreriskwithourmoney,byraisingthefees andinterestratesthattheychargeus,bycontinuingtoforecloseonourhomes,andcutting lendingtosmallbusinessesinourcommunities.Furthermore,theyareonalobbyingspree, usingourmoneytolobbyagainstthesensiblereformthatAmericanswant.Theyhavefought toothandnailagainstreformssuchastheConsumerProtectionAgencythatwouldprotectus fromtheirabuses. Despitetakingourmoney,thebankshavedonelittletohelprevitalizetheeconomy.The bailoutwassupposedtorescuethelargereconomy,notturnintoahandouttoWallStreet. Thebanks,throughtheirriskybehavior,robbedaverageAmericansoftrillionsofdollarsofour wealth.Theyhavetakentrillionsinbailoutsandbackstopsandhavedonenothingtofixthe overalleconomythattheycrashed. ItistimeforthebankstostartaidinginAmericaseconomicrecovery.Thebanksneedto: 1. StopforeclosuresandsaveAmericanshomesandstateandlocalbudgets; 2. Providethesameaffordableloanstostateandlocalgovernmentsthatbanksreceive fromthefederalgovernment; 3. Restoresmallbusinesslendingtosavejobsandtaxrevenue;and 4. Lowerinterestratesonconsumercreditcardsandstopchargingabusiveoverdraft feesthattakebillionsoutofconsumerspockets.

TheBailout:AYearinReview

Ayearago,asthebanksfellapart,thefederalgovernmentmovedinwithavarietyofprograms tobailthemoutandpreventthemfromtakingtheentireeconomyintoafreefall. Althoughthe$700billionTroubledAssetsReliefProgram(TARP)isthebestknown,inreality, thefederalgovernmentsetupavarietyofprogramstobackstop,guarantee,infuse,andhold upthebanks.Taxpayershavealreadycommitted$4.7trilliontothefinancialsectoroverthe lastyearthroughanalphabetsoupofprogramslikeTLGP,TALF,andHAMP.2Moreover,while bankslikeGoldmanSachs,MorganStanley,andJPMorganChasecannowbragaboutgetting approvalforand,insomecases,actuallyreturningTARPfunds,theywillcontinuetobenefit

fromthisplethoraofothertaxpayerhandouts,3suchasthe$12.9billionthatGoldmanSachs receivedasacounterpartytoAIGthatitwillneverhavetopayback.4 TheFederalReservehassetupemergencylendingfacilitiesthatgivebanksaccesstocheap moneytogetthemtostartlendingagain.TheFDIChasunveiledguaranteeprogramsto protectthebanksagainstlosses.TheTreasuryhaspledged$200billiontosupportFannieMae andFreddieMac.HUDhasput$300billionintotheHopeforHomeownersProgram.Onceall ofthecrisisrelatedprogramsarefactoredin,includingthestimuluspackageandtheauto bailout,thetotaltaxpayerscouldbeonthehookforupto$17.8trillion.5 Theseprogramshavesavedthebanksfromtheirriskybetsontoxicsecurities.However,banks nowclaimtheyarebacktoprofitabilityanddoingwelldespitetheircontinuedrelianceon thesetaxpayerfundedprograms.

TrillionsofDollarsinLostWealth

Oneyearlater,theAmericanfamilieswhofundedthebailoutarenotdoingsowell.Thefallout fromthisbankinducedeconomiccrisishashitAmericanshard.Americanfamilieslost$11 trillioninwealthin2008alone,nearly18%oftheirnetworth.6Millionsofushavelostourjobs orbeenthrownoutofourhomes.Personalbankruptcieshaveshotthroughtheroof.Ourlife savingsandretirementfundshavebeendecimated.Andbecauseofbillionsinbudget shortfalls,ourstateandlocalgovernmentsarebeingforcedtocutbackonserviceslikepublic healthprogramsandchildhoodeducation.Thisisallaboveandbeyondthetrillionsinbailouts andbackstopsthatwehavehadtoforkovertothebanks. RisingForeclosures Ourcommunitieshavebeendevastatedbytheforeclosurecrisis.Americanfamilieshavelost $6.1trillioninhomeownerwealthsince2006.7Theaveragehomeownerhaslostalmost $110,000inequity.8Inaviciouscycle,foreclosurescausepropertyvaluesofneighboring homestodecline,makingitmoredifficultforneighboringhomeownerstorefinancetheirloans, inturncausingthemtofallintoforeclosureaswell.EverythirteensecondsanotherAmerican homegoesintoforeclosure.9 AccordingtotheNewYorkTimes,arecentsurveybytheMortgageBankersAssociationfound thatsixmillionloanswereeitherpastdueorinforeclosureinthesecondquarterof2009,the highestleveleverrecordedbythegroup.10By2011,nearlyhalfofallAmericanswillbe underwaterontheirmortgages.11InpartsofCalifornia,Nevada,andFlorida,thenumberwill beover90%.12FormostAmericans,ourhomeisamajorsourceofwealthforourfamilies.This isastaggeringlossofwealththatmostofourfamilieswilllikelyneverrecover. Unfortunately,banksarenotdoingtheirparttohelpfixtheproblem.AstudybytheFederal ReserveBankofBostonshowsthatbanksarenotmodifyingloanstohelphomeownersavoid foreclosurebecauseLoanmodificationisnotprofitableforlenders.AccordingtotheBoston

Globe,thestudyfoundthatonly3percentofseriouslydelinquentborrowersthosemore than60daysbehindhadtheirloansmodifiedtolowermonthlypayments.13 Industryinsiderssaythatthereasonbanksarereluctanttomodifyloansisthatdelinquent loansallowthebanksthatservicetheloanstocollectfeesfromthehomeownerlatefees, feesforinsurance,appraisals,titlesearches,andlegalservices.14Becausemortgagesare typicallysoldofftothirdpartyinvestorswhoabsorbthelosseswhenahousegoesinto foreclosure,thebanksthatservicetheloansoftendonothaveavestedinterestinavoiding foreclosure.15Thereforetheyareabletomaximizetheirprofitsbychargingfeesas homeownersfallbehindontheirpaymentsandslowlyslipintoforeclosure. AccordingtoanattorneyattheNationalConsumerLawCenterquotedintheNewYorkTimes, Servicersthushaveanincentivetopushhomeownersintolatepaymentsandkeepthem there:iftheloanpayslate,theservicerismorelikelytoprofit.16 AccordingtotheTreasuryDepartmentsfirstmonthlyreportonloanmodificationsinAugust, BankofAmericaandWellsFargoweretheworstperformersamongthebigbankswhenitcame toloanmodifications.17Despitethefactthatthetwobankshavetaken$70billionindirect TARPfundsandpostedover$13billioninprofitsinthefirsthalfofthisyear,18theystillarenot doingtheirparttohelptheverytaxpayerswhobailedthemouttostayintheirhomes. RisingUnemployment Over5.3millionAmericanshavelosttheirjobssincelastSeptember,19andthenational unemploymentratehasclimbed56%,from6.2%inSeptemberto9.7%inAugust,20itshighest in26years.21Additionally,another291,000Americanshavebeenaddedtotheranksof discouragedworkerswhoarenolongerincludedinunemploymentfiguresbecausetheyhave stoppedlookingforwork.Thenumberofdiscouragedworkersisup62%sincelast September.22Altogether,thereare25.8millionunemployed,underemployed,ordiscouraged workersintheUS,16.8%ofthenationalworkforce.23 Risingunemploymenthastakenatollonourfamilies,asforthefirsttimeever,thenumberof Americansreceivingfoodstampstopped34million,orroughlyoneinnineAmericans.24 Becauseunemploymentreducesdisposableincome,itleadstodecreasedconsumerspending, whichservestodeepentherecession,possiblyleadingtoevenmorelayoffsand unemployment. RisingPersonalBankruptcies Personalbankruptcyfilingshavesurgedoverthelastyearduringtheeconomicdownturn.1.25 millionpeoplefiledforpersonalbankruptcyintheyearendinginJune,up34%fromthe previousyear.25Expertspredictfilingsthisyearwillbereachlevelsnotseensince2005,when 2.04millionpeoplerushedtofilebeforeanewlawwentintoeffectmakingitmoredifficultto fileforbankruptcy.26InJulyalready,morethan126,000peoplefiled,thehighestmonthly figuresincethe2005lawwentintoeffect.27 5

 LostRetirementSecurity TheturmoilinthestockmarketscausedbyWallStreetsmisstepshashadprofound ramificationsforMainStreet.Americanworkerspensionshavetakenaserioushitduringthe crisis,puttingmillionsofhardworkingAmericansretirementsecurityatrisk.Inthetwelve monthsbetweenOctober2007andSeptember2008,thetop1,000pensionfundsinthe countrylost$1trillioninvalue.InthethreemonthsfollowingtheLehmanBrotherscollapse, thelossesacceleratedrapidly,andbyDecember2008,theyhadlostanadditional$754billion. Thefundslost23.3%oftheirvalue($1.75trillion)injustfifteenmonths,theworstlossesin30 years.28 CutstoServices Fallinghomevaluesandrisingunemploymenthavetakenatollonourstateandlocaltax revenues.The$6.1trillioninhomeownerwealththathasbeenlostinthelastthreeyearshas ledtoa$58billionreductioninannualpropertytaxrevenues.29Thedeclineintaxreceiptshas contributedtobudgetcrisesalloverthecountry.InaNationalLeagueofCitiessurvey,67%of citiesreportedhiringfreezesorlayoffsand62%reportedhavingtodelayorcancelcapital projectsbecauseofdeteriorationintheeconomy.30AccordingtotheCenterforBudgetand PolicyPriorities,Atleast48stateshaveaddressedorstillfaceshortfallsintheirbudgetsfor fiscalyear2010totaling$165billionor24percentofstatebudgets,and34statesarealready anticipatingholesintheir2011budgetstotalingatleast$180billion.31 Asaresult,stateshavebeenforcedtomakedrasticcuts:32 21stateshavemadecutstopublichealthprograms. 22stateshavemadecutstoservicesfortheelderlyanddisabled. 24stateshavemadecutsinK12education. 32stateshavemadecutsinhighereducation. 40stateshavemadecutsintheirgovernmentworkforce,oftenthroughlayoffs.

BacktoBusinessasUsual

Whiletaxpayerssufferunderthecrushingburdenoftheeconomiccrisisandareonthehook fortheWallStreetbailouts,thebigbanksarebacktobusinessasusual.Theyareignoringtheir commitmentstotaxpayersandarehelpingthemselvesinstead,settingasidetensofbillionsfor bonuses,returningtothesameriskybehaviorthatcausedthecrisisinthefirstplace,and makingtensofbillionsinprofitsonthebacksofAmericanconsumers. BillionsinBonuses WallStreetsbonusstructureincentivizedshorttermprofitsoverlongtermstability.Bankers wereawardedbonusesbasedonhowtheirtradesperformedintheshortrun.Iftheirbets wentbadacoupleofyearsdowntheroad,theygottokeepthemoneyanyway.This encouragedexcessiveriskraking,sincethebankerstradesonlyhadtoperformwelluntilthey 6

werepaidtheirbonuses.Thisperversecompensationstructurehasbeenidentifiedasaculprit intheeconomiccrisis.33 InhisreportonWallStreetbonuses,NewYorkStateAttorneyGeneralAndrewCuomowroteof WallStreetsheadsIwin,tailsyoulose34bonussystem:

[T]hereisnoclearrhymeorreasontothewaybankscompensateandrewardtheir employees[I]nthesechallengingeconomictimes,compensationforbankemployees hasbecomeunmooredfromthebanksfinancialperformance. Thus,whenthebanksdidwell,theiremployeeswerepaidwell.Whenthebanksdid poorly,theiremployeeswerepaidwell.Andwhenthebanksdidverypoorly,theywere bailedoutbytaxpayersandtheiremployeeswerestillpaidwell35

Yet,despitethisrecognitionthatexcessiveandperversecompensationstructureshelpedfuel theeconomiccrisis,thebigbanksarecontinuingtopaytheirexecutivesastronomicalsalaries andbonuses.Thispastwinter,thenationstopsixbanks(BankofAmerica,Citigroup,Goldman Sachs,JPMorganChase,MorganStanley,andWellsFargo)paidout$31.2billionin2008 bonusestorewardtheirbankersforposting$84.6billioninlosseslastyearandwreakinghavoc ontheglobaleconomy.36 Inthefirsthalfof2009,thesesixbigbankssetaside$74.4billioninbonusesandcompensation fortheiremployees.37Atthisrate,total2009compensationatthesebankscouldtop$148 billion,almostasmuchasthe$160billionindirectTARPinfusionsthatthesesixbankstooklast fall.Thiswouldbeevenhigherthanthebankspaidoutanyyearduringthesubprimeboom.38 Evenmoreoutrageous,thetwomostheavilybailedoutbanks,BankofAmericaandCitigroup, areincreasingemployeesbasesalariestogetaroundlimitsonbonusesforTARPrecipients.39 Citigroupwillhikesalariesbyasmuchas50%,sothatmostemployeescompensationwillnot comedownfromlastyearslevels.40BankofAmericaisalsoofferingsigningpackagestoits newMerrillLynchhiresthatareevenricherthanwhatMerrillpaidoutatthepeakofthe economicboomin2006and2007.41 BillionsinProfits Thesamebanksthatwereonlifesupportayearagopostedbillionsinprofitsjustmonthslater. Inthefirsthalfof2009,thetopsixbigbanksalonebroughtin$29.6billioninprofits.42 GoldmanSachspostedthebiggestquarterlyprofitinits140yearhistorythispastJune, bringingin$50millionaday.43 Thebanksdiditbyresortingtothesameoldtricksasbeforeincreasingrisk,hikingupbank feesandcreditcardinterestrates,cuttingsmallbusinesslending,andbyrefusingtomodify mortgagestopreventforeclosuressothattheycancollectfeesinsteadasmentionedearlier. IncreasingRisk 7

Thebanksareonceagainembracingthesamekindofexcessiverisktakingthatcausedthe crisisinthefirstplace: GoldmanSachsturnedarecordprofitinthesecondquarterbymakingevenriskierbets thanitwasmakingbeforethecrisishit.Thebankactuallyincreaseditsriskprofileafter gettingtaxpayerbailoutfunds,makingitsrecordprofitsbygamblingwithourmoney.44 BankofAmerica,Chase,andCitigrouparealllinkingcorporatecreditlinestocredit defaultswaps,thesamecomplexderivativesthatcausedAIGtocollapse.45 MorganStanley,SmithBarney,andUBSarenowsellingstructurednotes,whichare essentiallyhighlyriskyandcomplexderivativesforsmallbusinesses.46 Inrecentmonths,investmentbankshavestartedrepackagingoldmortgagebacked securitiesandsellingthemagainasnewproducts.Thesewerethesametoxicsecurities thathelpedcausethecrisisinthefirstplace,andbanksareagainrepackagingand marketingthemassupersafeAAAratedinvestments.47 BankslikeWellsFargo,USBank,andFifthThirdarestartinguporexpandingusurious paydayloanprogramsthatchargeinterestratesashighas400%tolowincome,high riskconsumerswhotypicallycannotaffordtopaybacktheloans.48 HikingBankAccountFees Banksarealsoboostingtheirbottomlinesbyraisingfeesonconsumerstooffsettheirlosseson riskyloansandtoxicsecurities.49Americanconsumerswillpaymorethan$38billionin overdraftfeesthisyear,50morethantheannualrevenuesofmostFortune500firmsincluding Apple,Google,andNike.51Thatis$125foreveryman,woman,andchildintheUnitedStates.52 Thenationalmedianoverdraftfeerose4%thisyear,to$26,thefirsttimethefeehasgoneup duringarecession.53Earlierthisyear,BankofAmericamorethandoubleditsdailyoverdraft feelimitfrom$160to$350.54 Butthefeeincreasesarenotlimitedtooverdrafts.BankofAmericaalsoincreaseditsmonthly maintenancefeeforitsMyAccessCheckingAccountsby50%thisyear.55Meanwhile,Wells Fargo,JPMorganChase,andUSBankarepassingincreasedcostsfordepositinsuranceonto customers.56AstheNewYorkTimesputit,theresultisthatAmericansarepayingmoreto saveandspendtheirmoney.57 RaisingCreditCardRates Banksarealsorunningupinterestratesandfeesoncreditcardratesinanefforttoboost profitsbeforethenewcreditcardreformstakeeffectnextyear.58Thisyear,Citigrouphas raisedinterestrateson1315millioncreditcardholders,byanaverage24%,ornearlythree percentagepoints.59BankofAmerica,JPMorganChase,andCapitalOnealsohikedupinterest ratesonmanyoftheircardholdersthathadnevermissedapayment.60BankofAmericahad alreadybeenarbitrarilyraisinginterestratesonatleastonemillionplaybytherules,payon timecustomersevenbeforethebailout.61BankofAmerica,Chase,andDiscoverhaveallraised transactionfeesforbalancetransfersoncreditcardsbyatleast20%.62 8

CuttingSmallBusinessLoans Eventhoughbailoutfundswereintendedtogetbankstostartlendingagain,thebankshave drasticallyreducedtheirsmallbusinesslending.WhensmallbusinesseslikeRepublicWindows andDoorsinChicagolosetheirfinancing,theyoftenhavetoshuttertheirdoors,leadingto masslayoffs.56%ofsmallbusinessesthathaveproblemsfindingcreditreportedhavingtolay offemployeesasaresultinaNationalSmallBusinessAssociationsurvey.63BetweenOctober 2008andApril2009,smallbusinesslendingthroughtheSmallBusinessAdministrationsmain programdecreased42%overthepreviousyear.64Meanwhile,thenationalunemploymentrate skyrocketed,from6.2%inSeptember2008to9.7%inAugust2009.65 Butatthesametimethatbanksarecuttingsmallbusinessloans,theyarecontinuingtolendto largecorporationsandprivateequityfirms.Forexample,BankofAmerica,JPMorganChase, Citigroup,GoldmanSachs,andMorganStanleyallhelpedfinancethe$68billionPfizerWyeth merger,whichwilllikelyresultinthousandsoflayoffs.66BankofAmerica,JPMorganChase, Citigroup,andMorganStanleyareallamongthebanksproviding$3.1billioninfinancingto helpprivateequityownedWarnerChilcottbuyProcterandGamblesdrugbusiness.67

StandingintheWayofReform

Aftercrashingtheeconomyandtakingtrillionsofdollarsinbailoutsandbackstops,thebanks arenowusingourownmoneyagainstus.Theyarespendingmillionsofdollarsofourmoneyto lobbyagainstreformsthatwouldprotectusfromtheirabusesinthefuture.Intheninemonths followingthebailout,companiesinthefinancial,insurance,andrealestatesector(which includesbanksandotherbailedoutcompanieslikeAIG),spent$321milliononlobbying.68The topsixbanksalonespent$28.4millionlobbyingduringthistime.69 ManybankslobbiedagainstpoliciesthatwouldhelpprotectAmericans,bothastaxpayersand consumers.Theyfoughtagainst: TheformationofaConsumerFinancialProtectionAgencytoprotectconsumers interests;70 Limitsonexecutivecompensationandbonusestoensurebanksdontusetaxpayer dollarstopayoutbonuses;71 TheregulationofoverdraftfeestoprotectAmericanconsumersfrommisleadingand potentiallypredatorybankpolicies;72 Creditcardreform,includingcapsoninterestratesandabanonanytimeforany reasonratehikes;73 LoanmodificationproposalstohelpkeepmillionsofAmericansintheirhomes;74and Abanonpaydaylending.75

Thebigbankspredatoryandabusivebusinesspracticescostustrillionsofdollarsinlostwealth andbroughttheeconomytothebrinkofcollapse.Nowtheyarefightinganalloutwarto preservetheabilitytodoitalloveragain,andtheyareusingourmoneyastheammunition.

ARealEconomicRecovery
Nowthatthebigbanksarebacktoprofitability,theirpromoterswouldhaveusbelievethatthe worstisbehindus.WallStreetcelebratesgreenshootsintheeconomyandpointstosignsof aneconomicrecovery,butMainStreetisstillhurting. Thisfeelslikedjvu.Themarketwascelebratingsignsofrecoverylastyeartoo,justmonths beforetheLehmanBrotherscollapse. InJuly2008,accordingtotheLosAngelesTimes,PresidentGeorgeBushtriedtocalmthe marketsbysaying,Wewillcomethroughthischallengestrongerthaneverbefore.Our economyhascontinuedgrowing,consumersarespending,businessesareinvesting,exports continueincreasing,andAmericanproductivityremainsstrong.76AmonthlaterinlateAugust, thenewGDPreportshowedUSeconomicgrowthtobemuchstrongerthanpreviously believed.77Andfinally,twoweekslater,onSeptember15th,themorningthatLehman collapsed,SenatorJohnMcCainassertedforcefullythatthefundamentalsofoureconomyare strong.78 Similarly,thisyear,weveseenrepeatedeffortstosoundthetrumpetsanddeclarevictory prematurely.Forexample,eventhoughthemarkethascelebratedbigbanksprofitssofarthis year,theHuffingtonPostreportedthatThepercentofbanksthatlostmoney[inthesecond] quartersetanalltimehigh.79Infact,thepercentageofbanksthatwereunprofitableinthe firsthalfof2009isup59%fromlastyear.2008wastheindustrysworstyearforprofitability, and2009iscurrentlyonpacetobeatit.80 Thishasbeengoingonallsummer.FirstinMay,evenbeforetheresultsoftheTreasury Departmentsstresstestsofthelargestfinancialinstitutionscameout,theNewYorkTimes reportedthattheObamaadministrationseemspreparedtoarguethatthebroadfinancial systemishealthierthanmanyinvestorsfear.81Thestresstestsshowedthatthebiggest financialinstitutionsneededtoraiseanadditional$75billion.82Itwaslaterrevealedthatthe numberhadactuallybeenreviseddownwardsatthebehestofthebanks,andthattheFederal Reservesinitialfindingshadputthenumberevenhigher.83 TheninJune,DowJonesreportedthatadeclineincreditcarddelinquenciesintheprevious monthwasignitinghopeofaturnaroundamonginvestorsofplastic,eventhoughthesame articlealsonotedthatactualcreditcardlosseshadcontinuedtoclimb.84Amonthandahalf later,thegovernmentcelebratedthattheoveralleconomycontractedatanannualrateof only1percentinthespringquarter85ToWallStreet,thatmaybeareasontorejoice.Tothe averageAmerican,itmeansthingscontinuedtogetworse. InearlyAugust,theNewYorkTimesreportedthatThemosthearteningemploymentreport sincelastsummersuggestedonFridaythatarecoverywasunderway86Thisheartening reportactuallyshowedanadditionalquartermillionjoblossesinthemonthofJuly,andwhile theseasonallyadjustedunemploymentratedeclinedatenthofapercentagepoint,itwas 10

mainlybecausesomanypeopledroppedoutofthehuntforwork,ceasingtolistthemselves asunemployed.87Onceagain,themarketwasnotcelebratingthingsbetter,butthatthey weregettingworsemoreslowly. ThentowardstheendofAugust,anotherNewYorkTimesarticlereportedthatStandard& PoorsCaseShillerHomePriceIndexwasshowingimprovementsinmajorcitiesacrossthe country,[i]naconvincingsignthattheworsthousingslumpofmoderntimesiscomingtoan end88Butattheendofthesamearticle,therewasabriefmentionofthefactthatwith unemploymentnearing10percent,thereareprobablymoreforeclosurestocome,which couldpushpricesbackdown,89makingthatconvincingsignofareversaloffortunesseema littlelessconvincing. Thatsameweek,FederalReserveofficialsstartedpushingoutthemessagethattaxpayershad actuallymademultibilliondollarprofitsoffofthebanksthathadrepaidtheirTARPfunds.90But asRollingStonewriterMattTaibbipointedoutinhisblog,Thisissortoflikecalculatingthe returnsonamutualfundbyonlycountingthestocksinthefundthathavegoneup,sinceonly thehealthiestbankshaverepaidtheirTARPfundssofar.91Arecentstudyactuallyfoundthat TARPwas$148billionintheredasofJune.92 Allthechatterabouteconomicrecoveryandtheendoftherecessionisnomorecrediblenow thatitwasayearago.Infact,asfinancialstockstumbledatthestartofSeptember,even CNNMoneyreportedaboutworriesthatmarketgainshaveracedaheadofanyeconomic recovery.93WallStreetseternaloptimismwhenitcomestotheeconomyisjustadistraction tokeepusfromdemandingrealregulatoryreformsothatthebigbankscancarryonwith businessasusual,robbingusoftrillionsofdollarsfordecadestocome. Weneedarealeconomicrecovery.Thebanksbroketheeconomy,madeuspayforrepairs thatbenefittedbankersbuthavehadlittleeffectontherestofus,andnowarereadyingto breakitagainatourexpense.Itistimeforthemtofixwhattheybrokeandtogettheeconomy backontrackinawaythatworksforus,thetaxpayerswhobailedthemoutwhentheirbacks wereagainstthewall.

11

Endnotes
1

AndrewRossSorkinandVikasBajaj,ShiftforGoldmanandMorganMarkstheEndofanEra,NewYorkTimes, 22Sep2008,http://www.nytimes.com/2008/09/22/business/22bank.html. 2 JimKuhnhenn,USfinancialmarketbailouttabhits$4.7trillion,AssociatedPress,20Jul2009, http://www.google.com/hostednews/ap/article/ALeqM5heUXausbmwbNjC7_DaF4ZnJ3dYhgD99IEBJG4. 3 MattTaibbi,TheGreatAmericanBubbleMachine,RollingStone,13Jul2009, http://www.rollingstone.com/politics/story/29127316/the_great_american_bubble_machine;AndrewBary,How DoYouSpellSweetDeal?ForBanks,ItsTLGP,Barrons,18Apr2009, http://online.barrons.com/article/SB124001886675331247.html. 4 PaymentstoAIGSecuritiesLendingCounterparties,AIG, http://msnbcmedia.msn.com/i/CNBC/Sections/News_And_Analysis/_News/__EDIT%20London/AIG_Counterpartie s_List.pdf. 5 TreasuryDepartmentdocumentsfromtheFederalReserveBankBoardofGovernors,FederalReserveBankof NewYork,FDIC,SIGTARP,andFinancialStability.gov. 6 S.MitraKalita,AmericansSee18%ofWealthVanish,WallStreetJournal,13Mar2009, http://online.wsj.com/article/SB123687371369308675.html. 7 AmericansLose$1.4TrillioninHomeValuesinQ4;MoreThanwasLostinAllof2007,Reuters,03Feb2009, http://www.reuters.com/article/pressRelease/idUS153982+03Feb2009+PRN20090203. 8 Lossofhomeequityisthecruxofcrisis,NORMarketplace,24Dec2008, http://marketplace.publicradio.org/display/web/2008/11/24/dean_baker_commentary/?refid=0#. 9 KentAnderson,ANewForeclosureEveryThirteenSeconds,MortgageLawNetwork,23Feb2009, http://www.mortgagelawnetwork.com/anewforeclosureeverythirteenseconds/. 10 http://www.nytimes.com/2009/08/28/opinion/28fri1.html 11 AlYoon,AbouthalfofUSmortgagesseenunderwaterby2011,Reuters,05Aug2009, http://news.yahoo.com/s/nm/20090805/bs_nm/us_usa_housing_deutschebank. 12 AlYoon,AbouthalfofUSmortgagesseenunderwaterby2011,Reuters,05Aug2009, http://news.yahoo.com/s/nm/20090805/bs_nm/us_usa_housing_deutschebank. 13 Lendersavoidredoingloans,Fedconcludes,BostonGlobe,07Jul2009, http://www.boston.com/business/articles/2009/07/07/lenders_avoid_redoing_loans_fed_concludes/?page=full. 14 PeterS.Goodman,LucrativeFeesMayDeterEffortstoAlterLoans,NewYorkTimes,30Jul2009, http://www.nytimes.com/2009/07/30/business/30services.html?_r=2&scp=1&sq=late%20fee%20profits&st=cse. 15 PeterS.Goodman,LucrativeFeesMayDeterEffortstoAlterLoans,NewYorkTimes,30Jul2009, http://www.nytimes.com/2009/07/30/business/30services.html?_r=2&scp=1&sq=late%20fee%20profits&st=cse. 16 PeterS.Goodman,LucrativeFeesMayDeterEffortstoAlterLoans,NewYorkTimes,30Jul2009, http://www.nytimes.com/2009/07/30/business/30services.html?_r=2&scp=1&sq=late%20fee%20profits&st=cse. 17 DawnKopecki,BankofAmericaAmongWorstforLoanModifications,Bloomberg,04Aug2009, http://www.bloomberg.com/apps/news?pid=washingtonstory&sid=aaiRx.lyFD4I#. 18 AndrewM.Cuomo,NoRhymeorReason:TheHeadsIWin,TailsYouLoseBankBonusCulture,Jul2009, AppendixC,pages1421, http://www.oag.state.ny.us/media_center/2009/july/pdfs/Bonus%20Report%20Final%207.30.09.pdf. 19 BureauofLaborStatisticsMonthlyEmploymentData. 20 BureauofLaborStatisticsMonthlyEmploymentData. 21 USfoodstamplisttops34millionforfirsttime,Reuters,06Aug2009, http://www.forbes.com/feeds/reuters/2009/08/06/200908 06T152646Z_01_N06328040_RTRIDST_0_FOODSTAMPSUSA.html. 22 BureauofLaborStatisticsMonthlyEmploymentData. 23 ArthurDelaney,UnemploymentRateHits9.7PercentAsEconomySheds216,000JobsinAugust,Huffington Post,04Sep2009,http://www.huffingtonpost.com/2009/09/04/unemploymenthits97ase_n_277218.html. 24 USfoodstamplisttops34millionforfirsttime,Reuters,06Aug2009, http://www.forbes.com/feeds/reuters/2009/08/06/200908 06T152646Z_01_N06328040_RTRIDST_0_FOODSTAMPSUSA.html. 25 NancyTrejos,PersonalBankruptcySurges34Percent,WashingtonPost,14Aug2009, http://www.washingtonpost.com/wpdyn/content/article/2009/08/13/AR2009081303399.html.

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NancyTrejos,PersonalBankruptcySurges34Percent,WashingtonPost,14Aug2009, http://www.washingtonpost.com/wpdyn/content/article/2009/08/13/AR2009081303399.html. 27 NancyTrejos,PersonalBankruptcySurges34Percent,WashingtonPost,14Aug2009, http://www.washingtonpost.com/wpdyn/content/article/2009/08/13/AR2009081303399.html. 28 ChristineWilliamson,Top1,000fundsdropcloseto$1trillion,Pensions&Investments,26Jan2009, http://www.pionline.com/apps/pbcs.dll/article?AID=/20090126/PRINTSUB/301269981/ 1/PENSIONFUNDDIRECTORY&template=printart&AssignSessionID=273361946539658. 29 Calculationis$6.1trillionx0.95%,themedianeffectivepropertytaxrateforU.S.owneroccupiedhousing, accordingtotheTaxFoundation:http://www.taxfoundation.org/files/proptax_ownerocc_bystate20042007 20080923.xls. 30 ChristopherW.HoeneandMichaelA.Pagano,CityFiscalConditionsin2009,NationalLeagueofCities,Sep 2009,page6, http://www.nlc.org/ASSETS/E0A769A03B464963A81410F40A0529BF/CityFiscalConditions_09%20%282%29.pdf. 31 ElizabethMcNicholandIrisJ.Lav,NewFiscalYearBringsNoReliefFromUnprecedentedStateBudget Problems,CenterforBudgetandPolicyPriorities,12Aug2009,page1,http://www.cbpp.org/9808sfp.htm. 32 NicholasJohnson,PhilOIiff,andJeremyKoulish,AnUpdateonStateBudgetCuts,CenterforBudgetandPolicy Priorities,29Jun2009,pages511,http://www.cbpp.org/files/31308sfp.pdf. 33 StephenLabaton,TreasurytoSetExecutivesPayat7AilingFirms,NewYorkTimes,11Jun2009, http://www.nytimes.com/2009/06/11/business/11pay.html. 34 AndrewM.Cuomo,NoRhymeorReason:TheHeadsIWin,TailsYouLoseBankBonusCulture,Jul2009,page 3,http://www.oag.state.ny.us/media_center/2009/july/pdfs/Bonus%20Report%20Final%207.30.09.pdf. 35 AndrewM.Cuomo,NoRhymeorReason:TheHeadsIWin,TailsYouLoseBankBonusCulture,Jul2009,page 1,http://www.oag.state.ny.us/media_center/2009/july/pdfs/Bonus%20Report%20Final%207.30.09.pdf. 36 AndrewM.Cuomo,NoRhymeorReason:TheHeadsIWin,TailsYouLoseBankBonusCulture,Jul2009, AppendixA,page5, http://www.oag.state.ny.us/media_center/2009/july/pdfs/Bonus%20Report%20Final%207.30.09.pdf. 37 AndrewM.Cuomo,NoRhymeorReason:TheHeadsIWin,TailsYouLoseBankBonusCulture,Jul2009, AppendixC,pages1421, http://www.oag.state.ny.us/media_center/2009/july/pdfs/Bonus%20Report%20Final%207.30.09.pdf. 38 AndrewM.Cuomo,NoRhymeorReason:TheHeadsIWin,TailsYouLoseBankBonusCulture,Jul2009, AppendixC,pages1421, http://www.oag.state.ny.us/media_center/2009/july/pdfs/Bonus%20Report%20Final%207.30.09.pdf. 39 PatrickJenkins,WallStpaysoarsinbidtohalttalentexodus,FinancialTimes,22Jun2009, http://www.ft.com/cms/s/0/7475d4ce5ec511de91ad00144feabdc0.html. 40 EricDash,CitigroupHasaPlantoFattenSalaries,NewYorkTimes,24Jun2009, http://www.nytimes.com/2009/06/24/business/24citigroup.html. 41 GregFarrell,Merrillinaggressivehiringpush,FinancialTimes,14Aug2009, http://www.ft.com/cms/s/0/d9fabc32887411de82e400144feabdc0.html. 42 AndrewM.Cuomo,NoRhymeorReason:TheHeadsIWin,TailsYouLoseBankBonusCulture,Jul2009, AppendixC,pages1421, http://www.oag.state.ny.us/media_center/2009/july/pdfs/Bonus%20Report%20Final%207.30.09.pdf. 43 JoeBelBruno,GoldmanWinningStreak:$50MillionaDay,WallStreetJournal,06Aug2009, http://online.wsj.com/article/SB124948551533308045.html. 44 NomiPrins,HowYouFinanceGoldmanSachsProfits,MotherJones,28Jul2009, http://www.motherjones.com/politics/2009/07/howyoufinancegoldmansachs%E2%80%99profits. 45 JessicaSilverGreenberg,TheoFrancis,andBenLevisohn,OldBanks,NewLendingTricks,BusinessWeek,05 Aug2009,http://www.businessweek.com/magazine/content/09_33/b4143020536818.htm. 46 JessicaSilverGreenberg,TheoFrancis,andBenLevisohn,OldBanks,NewLendingTricks,BusinessWeek,05 Aug2009,http://www.businessweek.com/magazine/content/09_33/b4143020536818.htm. 47 UptoOldTricks,WallStreetRepackagesBadMortgages,AssociatedPress,24Aug2009, http://www.huffingtonpost.com/2009/08/24/uptooldtrickswallstr_n_267066.html. 48 JessicaSilverGreenberg,TheoFrancis,andBenLevisohn,OldBanks,NewLendingTricks,BusinessWeek,05 Aug2009,http://www.businessweek.com/magazine/content/09_33/b4143020536818.htm.

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MarshallEckblad,InBanksProfitPush,EraofLowFeesIsOver,WallStreetJournal,31Jul2009, http://online.wsj.com/article/SB124899068710295093.html. 50 DebitCardTrap,NewYorkTimesEditorial,20Aug2009, http://www.nytimes.com/2009/08/20/opinion/20thu1.html?_r=1. 51 JeffOstrowski,Banksfeastonbillionsinoverdraftfees,PalmBeachPost,23Aug2009, http://www.palmbeachpost.com/news/content/business/epaper/2009/08/23/a1b_bankfees_0824.html. 52 $38billiondividedbytheUSpopulation,perUSCensus:http://www.census.gov/. 53 EricDash,BankFeesRiseasLendersTrytoOffsetLosses,NewYorkTimes,02Jul2009, http://www.nytimes.com/2009/07/02/business/02fees.html?_r=1. 54 CaliforniaReinvestmentCoalitionOverdraftGuide,Nov2007,http://www.calreinvest.org/system/assets/99.pdf; BankofAmericaPersonalScheduleofFees,effective05Jun2009, https://www3.bankofamerica.com/efulfillment/documents/91113000ED.20090605.htm;JaneJ.Kim,Bank SuspendsOverdraftFeeIncrease,WallStreetJournal,13Apr2009, http://online.wsj.com/article/SB123967277269015845.html. 55 MarshallEckblad,InBanksProfitPush,EraofLowFeesIsOver,WallStreetJournal,31Jul2009, http://online.wsj.com/article/SB124899068710295093.html. 56 EricDash,BankFeesRiseasLendersTrytoOffsetLosses,NewYorkTimes,02Jul2009, http://www.nytimes.com/2009/07/02/business/02fees.html?_r=1. 57 EricDash,BankFeesRiseasLendersTrytoOffsetLosses,NewYorkTimes,02Jul2009, http://www.nytimes.com/2009/07/02/business/02fees.html?_r=1. 58 NancyTrejos,CreditCardIssuersRaisingRatesAheadofNewLaw,WashingtonPost,02Jul2009, http://www.washingtonpost.com/wpdyn/content/article/2009/07/01/AR2009070103868.html. 59 FrancesoGuerrera,SaskiaScholtes,andTomBraithwaite,Citiraisescardratesonmillions,FinancialTimes,30 Jun2009,http://www.ft.com/cms/s/0/e1d0c61065c711de8e3400144feabdc0.html?nclick_check=1. 60 LoreCroghan,Creditcardhikefright:Banksraisingrates,evenifyouvepaidontime,NewYorkDailyNews,16 Mar2009,http://www.nydailynews.com/money/2009/03/16/200903 16_credit_card_hike_fright_banks_raising_ra.html. 61 Creditcardusersgetrateshock,BaltimoreSun,19Feb2008,http://www.baltimoresun.com/business/bal bz.cardrates19feb19,0,2452533.story. 62 NancyTrejos,CreditCardIssuersRaisingRatesAheadofNewLaw,WashingtonPost,02Jul2009, http://www.washingtonpost.com/wpdyn/content/article/2009/07/01/AR2009070103868.html. 63 NationalSmallBusinessAssociation2009SmallBusinessCreditCardSurvey,page9, http://www.nsba.biz/docs/09CCSurvey.pdf. 64 SmallBusinessLendingatBankofAmerica,SEIU,22Jul2009,page3,http://www.seiu.org/changethat works/bankofamerica/bofasmbizfinal.pdf. 65 BLSMonthlyEmploymentData. 66 BankbailoutrecipientslinktoPfizerdeal,TradingMarkets.com,27Jan2009, http://www.tradingmarkets.com/.site/news/Stock%20News/2145293/. 67 FelixSalmon,Privateequityreleverageswithavengeance,ReutersBlog,25Aug2009, http://blogs.reuters.com/felixsalmon/2009/08/25/privateequityreleverageswithavengeance/. 68 TARPRecipientsPaidOut$114MillionforPolitickingLastYear,CapitalEyeBlog,OpenSecrets.org,04Feb 2009,http://www.opensecrets.org/news/2009/02/tarprecipientspaidout114m.html;ElizabethWilliamson, T.W.Farnam,andBrodyMullins,FinanceLobbyCutSpendingasFedsTargetedWallStreet,WallStreetJournal, 01Jul2009,http://online.wsj.com/article/SB124640640747376775.html. 69 LobbyingDisclosureActDatabase,http://soprweb.senate.gov/index.cfm?event=selectfields. 70 EdmundL.Andrews,BanksBalkatAgencyMeanttoAidConsumers,NewYorkTimes,01Jul2009, http://www.nytimes.com/2009/07/01/business/economy/01regulate.html?_r=1. 71 JaneHamsher,BailoutRecipientsSpent$13MillionLobbyingAgainstConsumers,ForTheirOwnBonusesin1Q 2009,FireDogLake.com,06May2009,http://firedoglake.com/2009/05/06/tarprecipientsspenttaxpayer dollarslobbyingagainstconsumersfortheirownbonusesin1q2009/. 72 AmericanBankersAssociationPolicyPositiononUnfairandDeceptiveActsandPractices, http://www.aba.com/Issues/Issues_UnfairDeceptive.htm. 73 LobbyingDisclosureActDatabase,http://soprweb.senate.gov/index.cfm?event=selectfields.

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RyanGrim,CramdownVote:BanksBoughtSenatorsOnTheCheap,HuffingtonPost,01May2009, http://www.huffingtonpost.com/2009/04/30/cramdownvotebanksbough_n_193674.html. 75 LobbyingDisclosureActDatabase,http://soprweb.senate.gov/index.cfm?event=selectfields. 76 MauraReynoldsandWalterHamilton,Economicindicatorspointtomoredistress,LosAngelesTimes,16Jul 2008,http://articles.latimes.com/2008/jul/16/business/fiecon16. 77 GregRobb,Secondquartergrowthrevisedsignificantlyhigher,MarketWatch,28Aug2008, http://www.marketwatch.com/story/revisedusgdpsurges33highwatermarkfor growth?print=true&dist=printMidSection. 78 AsWallStreetcollapses,McCaindeclaresthatthefundamentalsofoureconomyarestrong,ThinkProgress, 15Sep2008,http://thinkprogress.org/2008/09/15/aswallstreetcollapsesmccaindeclaresthatthefunamentals ofoureconomyarestrong/. 79 ShahienNasiripour,PercentofMoneyLosingBanksSetAnAllTimeHighInSecondQuarter,HuffingtonPost, 31Aug2009,http://www.huffingtonpost.com/2009/08/31/percentofmoneylosingb_n_272893.html. 80 ShahienNasiripour,PercentofMoneyLosingBanksSetAnAllTimeHighInSecondQuarter,HuffingtonPost, 31Aug2009,http://www.huffingtonpost.com/2009/08/31/percentofmoneylosingb_n_272893.html. 81 DavidLeonhardt,TestsofBanksMayBringMoreHopeThanFear,NewYorkTimes,04May2009, http://www.nytimes.com/2009/05/04/us/politics/04stress.html?_r=2&pagewanted=1. 82 EdmundL.Andrews,AilingBanksNeed$75Billion,U.S.Says,NewYorkTimes,08May2009, http://www.nytimes.com/2009/05/08/business/08stress.html?_r=1. 83 DavidReich,DanFitzpatrick,andMarshallEckblad,BanksWonConcessionsonTests,WallStreetJournal,09 May2009,http://online.wsj.com/article/SB124182311010302297.html. 84 AparajitaSahaBubna,LossesRoseOnCreditCardsInMaylDelinquencesFellABit,DowJones,16Jun2009, http://online.wsj.com/article/BTCO20090616713276.html. 85 JackHealyandLouisUchitelle,JobLossesSlow,SignalingShiftintheEconomy,NewYorkTimes08Aug2009, http://www.nytimes.com/2009/08/08/business/economy/08jobs.html?_r=3&hp. 86 JackHealyandLouisUchitelle,JobLossesSlow,SignalingShiftintheEconomy,NewYorkTimes08Aug2009, http://www.nytimes.com/2009/08/08/business/economy/08jobs.html?_r=3&hp. 87 JackHealyandLouisUchitelle,JobLossesSlow,SignalingShiftintheEconomy,NewYorkTimes08Aug2009, http://www.nytimes.com/2009/08/08/business/economy/08jobs.html?_r=3&hp. 88 DavidStreitfeld,IndexShowsanImprovementinHomePrices,NewYorkTimes,26Aug2009, http://www.nytimes.com/2009/08/26/business/economy/26econ.html. 89 DavidStreitfeld,IndexShowsanImprovementinHomePrices,NewYorkTimes,26Aug2009, http://www.nytimes.com/2009/08/26/business/economy/26econ.html. 90 ZacheryKouwe,AsBanksRepayBailoutMoney,U.S.SeesProfit,NewYorkTimes,31Aug2009, http://www.nytimes.com/2009/08/31/business/economy/31taxpayer.html?_r=2&hp. 91 MatTaibbi,BailoutPropagandaBegins,True/Slant,01Sep2009, http://trueslant.com/matttaibbi/2009/09/01/bailoutpropagandabegins/. 92 MatTaibbi,BailoutPropagandaBegins,True/Slant,01Sep2009, http://trueslant.com/matttaibbi/2009/09/01/bailoutpropagandabegins/. 93 AlexandraTwin,WallStreetstumblesintoSeptember,CNNMoney.com,01Sep2009, http://money.cnn.com/2009/09/01/markets/markets_newyork/index.htm?postversion=2009090115.

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