The Best Banks In North America Probably Aren’t Where You Think

[GoMontreal]

A lot of people were allowed to run loose and do whatever they wanted. Lending money to people they shouldn't have, providing people with mortgages that couldn't be paid, etc. Incorrect regulatory policy along with bad practice were a huge contributor to this mess. If you choose to believe otherwise, that's your prerogative.

 

As the most partisan person on mtlurb, your comments don't really surprise me, GoMontreal. It'll be a cold day in hell before you admit conservatives are capable of wrongdoing and liberals can be correct from time to time. With that in mind, i don't really feel like debating you on this one. If i wanted to listen to the same old talking points i'd turn on Fox news.

 

Most partisan? What the hell? Why am I labeled most partisan, everyone has their own opinions and voice them here, why should I refrain? -Maisonneuve- was crediting progressives for Canada's stability and I took issue with that. When people blame capitalism for the real estate bubble, I take issue with that because under real capitalism, the crisis would have been either a lot less bad or nonexistent.

 

I have as much complaints about republicans and conservatives as I have for liberals and democrats. I disagree with statism and progressivism and as far as I know, I'm still allowed to voice my opinion. And my opinion is a thoroughly thought through opinion, not talking points that I received from Fox News.

 

As for your first paragraph, I totally agree with what you said. The problem is that the US government, through CRA, forced banks to make ridiculous loans and indirectly encouraged them to make bad decisions (derivatives) in part to get rid of the risky mortgages in their attempt to offload the poison. Initially, it's the government's fault, it's progressives' fault.

 

If you give unlimited alcohol to an irresponsible teenager and then give him the car keys, why would you expect responsibility and restraint? Why would anyone expect the car to come back without a scratch?

Modifié 9 mars 2010 par GoMontreal

[Gbx]

Chill out everybody. GoMontreal is just saying that the crisis was originated not by a lack of regulation but rather by bad public policies. Contrarian to idea spread by the low class journalism of la presse or le devoir, people in the business know that banks are already quite regulated in the US though to a lesser extend than in Europe (by the way, that didn't help much to prevent the european banks from failing).

 

Canadian baking system is certainly better capitalised and more conservative but it suffers from low competition and high costs of services for customers, which means harder acess to capital and lower economic growth in the long term. So there's obviously a trade off here and in my opinion, the canadian banking system, although very sound, is certainly too much conservative. I'm actually rather pissed than proud when I see Scotia and Royal posting sky high profits at the peak of the recession and it certainly tells me we're all paying too much for our loans in canada.

[GoMontreal]

Canadian baking system is certainly better capitalised and more conservative but it suffers from low competition and high costs of services for customers, which means harder acess to capital and lower economic growth in the long term. So there's obviously a trade off here and in my opinion, the canadian banking system, although very sound, is certainly too much conservative. I'm actually rather pissed than proud when I see Scotia and Royal posting sky high profits at the peak of the recession and it certainly tells me we're all paying too much for our loans in canada.

 

I agree with you. It is nearly impossible to start a bank in Canada and that's why we have only a few of them whereas there are thousands in the US. However, I don't think that has to do with a fiscally conservative ideology. Fiscal conservatives are usually for free-markets and therefore competition. Harper has opened up the wireless regulations to allow more companies into the market to compete with the olygopoly that is Bell-Rogers-Telus. They should do the same with banks.

 

I wonder what the history is behind why we have so few banks?

[Cataclaw]

GoMontreal: pardon me, i meant no personal disparagement. I was merely observing that you seem to be an extremely hardline conservative, and as a result, your inclination is to blame liberals for everything (including the recent economic meltdown). Everyone is entitled to their opinions.

Modifié 9 mars 2010 par Cataclaw

[Habsfan]

I'm actually rather pissed than proud when I see Scotia and Royal posting sky high profits at the peak of the recession and it certainly tells me we're all paying too much for our loans in canada.

 

J'avoue que c'est chiant en maudit entendre la Banque Scotia annoncer des profits de 950 millions pour 1 semestre, quand le reste du continent est en recession...mais que voulez vous? C'est le système que nous avons, et le fait que ce système soit si conservateur, nous a permis d'éviter la récession (en partie) au Québec. L'autre raison est assez évidente je j'en ai parlé souvent. Quand on vole bas on ne tombe pas de très haut!

 

Harper has opened up the wireless regulations to allow more companies into the market to compete with the olygopoly that is Bell-Rogers-Telus.

 

This will be a very good thing. The Bell-Telus-Rogers Oligopoly is not good for our cell phone service. We have some of the highest fees in the world for our cell phone service...with the addition of a few american companies, that should help reduce the price!

[WestAust]

I wonder what the history is behind why we have so few banks?

 

One of the major difference in the banking systems between canada and usa was that up to about 10-15 years ago, interstate banking was not allowed in the united states, or very little, thus a bank could not be much bigger than it's home state. This resulted in plenty of smaller banks, when those restrictions were lifted, they merged together creating the banks we have now.

 

During that time, in Canada, we were on a countrywide banking system, and banks outgrew their provinces early, and also followed the people westward (note that no major bank is headquartered in the west, nor was founded in the west) merging together a while ago, which resulted in a few big banks, some smaller ones and credit unions, who other than Desjardins, aren't that big.

[GoMontreal]

GoMontreal: pardon me, i meant no personal disparagement. I was merely observing that you seem to be an extremely hardline conservative, and as a result, your inclination is to blame liberals for everything (including the recent economic meltdown). Everyone is entitled to their opinions.

 

Well, in a perfect capitalist economy, there would still be recessions because people get excited about stuff and loose their bearings and it creates bubbles. The tech bubble of 2000 is an example. There was too much going on and everyone wanted to profit from it but it turns out that half the companies had no revenues or foreseeable revenues. Having the bubble burst was exactly what needed to happen to get people thinking straight again. If the government had gotten involved to save all these useless websites, it would've caused a lot more damage. Saving people from themselves when it comes to house ownership is unfortunately the same thing. People need to fail so that they learn from their mistakes. If you don't let them fail, they will repeat and repeat and the prudent people will constantly pay for all the failures. It's not right.

 

There are statist/progressives in the right and the left. I used to be a hardline conservative, and before that, I was a lefty, but today, I found my place in the middle (believe it or not) and I'm a extreme middle of the road libertarian. And yes, there is a difference between a conservative and a libertarian. Republicans like Bush and McCain make me sick. Obama is even more statist/progressive, so he's even worse.

 

You could say that I'm a radical conservative when it comes to crime and defense (pro-army). Sentences should be much longer for most crimes. However, I apply that to real crime, not stuff like smoking pot. All drugs should be legal (even though I use none and don't want my kids to use any). I think the result of legalizing drugs would be less crime. But hey, that's another subject.

[Cataclaw]

I'm extremely liberal/progressive yet i'm very tough / "hardline" when it comes to crime/defense. I'm very pro-army (i'm in the army...) yet paradoxically anti-war in general (though i support the effort in Afghanistan) and i wish we'd be tougher on crime. Harsher penalties, more enforcement. And yes, like you, i don't think all drugs should necessarily be criminalized (pot)

 

Ironic, seems we share some common views!

 

What i don't like is libertarianism. This idea that small gov't is automatically better just doesn't seem right to me. Government is necessary. Sometimes i feel libertarianism straddles too close to no government/anarchy. Big government isn't automatically better either, though, so there has to be a middle ground. A "just right" size. What that size is depends on who you talk to. I believe roads and highways, for example, constitute an important thing that should be built and maintained federally. I find that health care is another such thing. The business of alcohol, not so much (the SAQ for instance)

 

Anyway, veering off topic here. One thing we can agree on, regardless of the cause: things aren't too shabby in Canada. Let's appreciate that.

Modifié 9 mars 2010 par Cataclaw

[GoMontreal]

I'm extremely liberal/progressive yet i'm very tough / "hardline" when it comes to crime/defense. I'm very pro-army (i'm in the army...) yet paradoxically anti-war in general (though i support the effort in Afghanistan) and i wish we'd be tougher on crime. Harsher penalties, more enforcement. And yes, like you, i don't think all drugs should necessarily be criminalized (pot)

 

Ironic, seems we share some common views!

 

Well, who really is pro-war? I mean, I would expect that most people are against war unless absolutely necessary. Once at war though, I don't think that quitting when the job is half done because some people forget why we went in is wise.

 

What i don't like is libertarianism.

 

LOL

 

This idea that small gov't is automatically better just doesn't seem right to me. Government is necessary. Sometimes i feel libertarianism straddles too close to no government/anarchy. Big government isn't automatically better either, though, so there has to be a middle ground. A "just right" size. What that size is depends on who you talk to. I believe roads and highways, for example, constitute an important thing that should be built and maintained federally. I find that health care is another such thing. The business of alcohol, not so much (the SAQ for instance)

 

Ok first, let me be clear: I'm not against government and don't believe that we should have no government. I'm not an anarchist. I believe we need government. However, government is like gravity, the only way it goes is bigger. So if there is no 'rules' for what the government can and can't get into (ex: US constitution), then it will get bigger and bigger until it explodes. I fear we are nearing that point, both in the US and in Quebec. The problem I find with the government getting so big is that it keeps creating new ways of controlling our lives.

 

With the government obviously taking sides on certain issues, people with an opposing viewpoint are left to dry. For example, with health care, if you want better or faster service than what you get with the government, too bad, you're stuck. Instead, if at least the hospitals were privatized with the government helping the poor/uninsured to pay for the services, then the costs and services would be drastically better, as they are in the US. The problem right now is that if you want better health care, you have to pay twice.

 

The fact is that private companies can do everything better and cheaper than the government. Cheaper is a given for the simple reason that companies compete for the work. Better is more complicated. For example, if you want your pot holes fixed and you just give the contract to the lowest bidder, you won't necessarily get the best result. However, if you put minimum requirements on the work, then you can control that. Another benefit is that since private companies are competitive, they innovate way more than government workers do.

 

You say that roads and highways should be built and maintained federally? What do you mean by that? You think Montreal should not be the one maintaining Sherbrooke street? Not sure I follow you on this.

 

It doesn't bother me that the municipal, provincial, or federal governments are involved in streets and highways. However, I think that private companies should be allowed to play in this arena. I would love to have a new bridge to the south shore built by a company and pay to use it. I could avoid Champlain bridge along with it's traffic headaches when I feel like paying. Since I would be paying for it, I would expect a smoother ride as well, and if it wasn't, I wouldn't pay and wouldn't use it. There isn't that option with the government's roads.

 

Further, there are private neighborhoods in the US that function quite well. The residents get together and decide which company will cut the grass, which will pick up the garbage and the recycling, etc. If the company doesn't do the work properly, they simply vote on giving the contract to another company. It works great and no government employees need to be involved, thereby reducing costs there too.

 

The main idea with a small/limited government, is that the 'power' is closer to the people. Like I just mentioned, if you don't like you trash pickup people, you can actually do something about it. The further the power is from you, the least you can do to change things and the more corrupt the government is.

[Cataclaw]

Hah, no, sorry. I didn't mean to suggest that the Canadian government decides which pot holes to fix on Sherbrooke street. I meant strictly highways. The feds can invest money into highway construction, but ultimately that is then diverted to provincial authorities, who draw up the plans. Municipal roads are one thing, inter-regional highways are another.

 

I think a central authority (such as the government) is best suited to determine where new roads should go, how much to invest and when to repair.

 

HOWEVER -- i agree that private investment in the area of roads is not a bad idea. It has to be monitored carefully and kept in check. Such projects would have to respect rights-of-way, zoning, land use and other regulations. But hey... private toll roads in some parts of America work, and i have no objections, as long as its regulated properly.

 

Please don't hate me for using the word 'regulation' ;)