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Money Center Banks don't want your money

Money Center Banks don't want your money, Evan. We're small potatoes requiring a lot of service and that costs money. The local banks will take your money & use it locally. We NEED the local banks for increased service and reduced charges.

Evan, where you put your money says a lot about what your needs are at the moment. Think of it as a heirarchy of needs, and that heirarchy changes as you have more money. When you first have discretionary income or money, you tend to put it into a local savings account. The interest earned is dirt but it's highly liquid and is insured (FDIC). You don't have to worry about losing it regardless of what happens to the economy, as long as it's less than $100K (the FDIC only insures up to $100K; after that, you're on your own.) For the average person, their money "is just down the street." It's not, but most people think it is.

As you acquire more savings, you start to think of a CD because it's also insured and earns a little higher interest. It's not as liquid, but hey - - you've got more money now & you can part with it for a few months or a year. Besides, you know the local bank: it's "just down the street and they've been there a while." As you progress with more savings, you probably buy a house to shelter income and your savings (the little man's biggest investment).

You reach a point where you probably have all of the above because you're doing it in stages & it protects you to have many layers. Somewhere in there you realized you could put savings into a "socially conscious fund" because you could afford to lose it or to earn less interest. Not that you wanted to lose it, but you could afford to, if necessary. You still need the local bank, however, for your other needs.

You have probably already bought stock (either directly or through a mutual fund) because that's where your greatest return is (the stock market, not the mutual fund.) But now you've gone NATIONAL, not local, because the stock market is national. Higher risk, higher reward.

If you really become big time, you move to a money center bank, e.g., NY or San Francisco, because your needs have changed. Once you have money, believe me, your needs have changed. Corporations are the biggest users of money center banks because they need to borrow large (repeat huge) amounts but they also have large cash flows. They have needs that we don't have as individuals. They need a bank that can handle speed, volume, international relationships, different types of transactions & sheer size of transaction. Money center banks move millions & millions of dollars daily, whether through wire transfer to other countries or through their local check clearing houses.

Here in Denver (or any large city), the local banks have their own clearing houses to minimize using the Federal Reserve (which charges for clearning checks). If everyone had to go through money center banks for any volume of money transfers, our system would be bogged down horribly. In addition, we'd be charged voluminous service fees, which we don't want. Thus, you could try to go multinational but

   1) you don't need their services
   2) you don't want to pay their fees
   3) you don't want to maintain huge balances that earn no interest
   4) they don't want you because they don't earn enough from you

In answer to your question, for the vast majority of people, local banking is better because it fits their needs.

Donna

Donna Plutschuck
donna@xxxxxxxxxxxx
Corporate Office Images, Ltd.
355 S. Teller Street, Suite 200
Lakewood, CO 80226
303.235.0989   fax 303.235.0124

----- Original Message ----- From: "Evan Daniel Ravitz" <evan@xxxxxxxx>
To: "Ralph Shnelvar" <ralphs@xxxxxxxxx>
Cc: "Nan Schweiger" <neschweiger@xxxxxxxxxxxxx>; "Some Guy" <someguy@xxxxxxxxxxxxx>; <TresCeeA@xxxxxxx>; <toso@xxxxxxxxxxxxxxxxxxxxxxx>; <taichiproj@xxxxxxxxxxxxx>; <SDeLeo@xxxxxxxxxxxxxxxxxxxxxxxxx>; <pklammer@xxxxxxx>; <myriah@xxxxxxxxx>; <mlambie@xxxxxxxxxxx>; <Margitjo@xxxxxxx>; <laurieannb@xxxxxxx>; <jpezzillo@xxxxxxxxx>; <cvv-discuss@xxxxxxxxxxxxxxxxx>; <mcgrath_mcnally@xxxxxxx>; <s.sadler@xxxxxxx>; <donna@xxxxxxxxxxxx>; <peter.raich@xxxxxxxx>; <carolyn@xxxxxxxxx>
Sent: Thursday, November 11, 2004 11:24 AM
Subject: Re: Conspiracy #645 -- or the way it is



Not knowing a lot of economics, I can see that putting one's money
in a socially conscious fund (as I did when I had more $) is better
than putting it in a local bank, but isn't local better than
multinational?

Evan

On Wed, 10 Nov 2004, Ralph Shnelvar wrote:

Dear Evan:

On Wed, 10 Nov 2004 16:21:23 -0700 (MST), you wrote:

>
>http://www.solari.com is great. -Evan
>

No it isn't.

Evan, you're a great guy and you're smart.

This kind of thing is completely worthless for a wide variety of reasons.

1) Even if 600,000 people pull all their money (let's say it's $50,000 each
on average ... a vast overestimate) that amounts to a whopping $30 billion.
Yawn. That's 1/3 of a day's trading on the NYSE.

2) Even if the money moves, where do you think it will go? Banks will lend
it back to the very people to whom the money was pulled out. There will be
a tiny blip as money moves around.

3) Money moves around. It is liquid. It goes to the highest rate of return
_especially_ if you don't specifically control it.

4) Like "Don't buy gas this Sunday", this is a harebrained scheme to put
pressure on the markets. It will not make news and it will have no effect
on markets or local economies other than to send dimes to the "My Dime is
Powerful" campaign.

5) The biggest effect this scheme and its promotion will have is to
disappoint the people who make the dislocation in their financial lives once
nothing happens.



If people want to have a real effect (and make money, too), invest in
"socially conscious" investment funds. For instance, see
http://www.socialfunds.com/. Whether you're a bleeding heart liberal or a
gun toting redneck, there's a fund for you.

Ralph Shnelvar