There are days one wonders whether the meltdown in the financial sector would lead to cheering and dancing in the streets, were it not for the fact that it’s taking the rest of us down with it.
Thursday was one of those days that the banking industry reminds us that it often has as much Snidely Whiplash in it as George Bailey. Two stories provide an example.
Former Merrill Lynch chief executive John A. Thain has “resigned” his job. He’s the one who arranged the sale of his firm to Bank of America in the darkest days of the meltdown. But just before the sale, he allegedly made sure that huge bonuses were paid out to execs. And he reportedly lobbied for a $10 million bonus for his good work arranging the sale of the company he drove into the ground.
Thain spent $1.2 million last year redecorating his office, including $87,784 on area rugs and $18,468 on a George IV chair, according to CNBC.
During a photo opportunity this morning, President Obama denounced the spending.
Closer to home, today the Star Tribune has the story of TCF Bank, which is doing better than many banks because its loan losses aren’t mounting as quickly as other banks. The report said real estate in areas where TCF does business has “stabilized.”
But we’re reminded how banks make much of their money and why they’re not making as much these days:
… TCF still faces significant headwinds. It’s a consumer-oriented bank that generates about a quarter of its revenue from fees and service charges. As unemployment has increased and consumer spending has declined, the bank’s fee income has also fallen, because people are writing fewer checks and overdrawing their accounts less frequently, the bank said.
Today the stock market is tanking again, partly on fears of the viability of banks. I should go bounce a check.