Former JPMorgan Banker: Exploiting Consumers Is ‘The Purpose Of The Banking Organization’

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http://www.alternet.org/story/153129/_former_jpmorgan_banker%3A_exploiting_consumers_is_%E2%80%98the_purpose_of_the_banking_organization%E2%80%99/

Wall Street banks, largely spared from the economic ruin felt by millions of Americans since the financial crisis of 2008, have returned to profitability, generating higher profits in the two-and-a-half years since the crisis than they did in nearly eight years preceding it. But that hasn’t stopped them from seeking new ways to generate revenue — like Bank of America’s proposed $5-a-month debit card fee or the millions banks have made from charging consumers to receive unemployment benefits or food stamps.

If all this makes Americans feel like Wall Street banks only view them as money-making tools, well, that’s because the banks apparently do. According to David Mooney, a former JPMorgan Chase employee, Wall Street banks see consumers as an “income stream” to exploit for profit-making purposes, Reuters reports:

David Mooney, chief executive officer of Alliant Credit Union in Chicago, one of the nation’s larger credit unions, used to work at a one of Wall Street’s top banks, JPMorgan Chase. There’s a vast cultural gap between Wall Street and his new world, he says: Old friends from the Street, he says, now jokingly refer to him as a “socialist.” A credit union is supposed to be run in the interests of all members, he says, while commercial bankers tend to see consumers as customers who can be “exploited” by layering on more fees.

[icnorth]

1. In the lexicon of the wall street bankers

do they still refer to their customers as "marks" or has that term fallen out of disfavor?

[sarcasmo]

9. No surprise, that is the same term a grifter would use.

[Starry Messenger]

2. k&r

[no_hypocrisy]

3. Remember the days when banks vied for you as a "valued customer"?

Personal service, toasters, introductory 0 percent interest on credit cards? Bankers and tellers knew you (and your dog) by your first name?

[xchrom]

4. indeed. nt

[marmar]

5. Quote from the character Umberto Calvini, in the film "The International":

'But this is the very essence of the banking industry, to make us all, whether we be nations or individuals, slaves to debt.'

[xchrom]

6. Very good film. Nt

[CreekDog]

7. That's funny. I'm an Alliant Member --they're pretty good

their branches are located to serve United Airlines employees, so you find them where there's a hub generally (Chicago, San Francisco, etc.)

between online banking and he co-op network, you don't really need the branches, but i kept looking for a good credit union that does have a local branch and this one was it.

[unblock]

8. ... in a way that's different from virtually all other for-profit businesses?

setting customer-owned structures such as credit unions and mutual companies aside, don't ALL for-profit, investor-owned businesses necessarily treat customers as income streams to be exploited? well, some are in a position to similarly exploit their suppliers, i suppose, but i'm not sure that's particularly different.



wall street survived (well, with some casualties) through (a) bailouts (b) ongoing government-engineered profit opportunities (mostly through zero percent interest rates) and (c) an ability to easily fire 2/3rds of their work force.

that last one is important. unlike, say, a manufacuring business, the wall street has very little in the way of expensive equipment investment that would be mothballed. firing 2/3rds of your staff in most industries would prevent you from doing what was needed to make a profit at all. not so on wall street. wall street businesses are composed of many groups each focusing on a different financial product or service. when any financial product or service stops being profitable, they just fire everyone involved until it becomes profitable again. so when the game changed because of the crisis, many such groups stopped being profitable, hence the firing of 2/3rds of the staff. so everyone left is focusing on the remaining, profitable products, which is one of the key reasons why they've quickly returned to profitability.

at the social expense of cutting a gazillion jobs. something few other industries can do without crippling themselves.