I just couldn’t resist clicking “Bank of America to pay $8.5 billion settlement over mortgages”. Finally the Bankers are paying for destroying the economy. My enthusiasm rapidly faded as I read the article. Then I read
“Shares of Bank of America Corp. jumped more than 4 percent, or 48 cents to $11.30 before the market opened”.
I should have stopped at the headline. More whining after the jump.
$ billion can be a very small amount of money. In this case it is a settlement for the alleged fraud committed by Countrywide. So the deal is that, if you destroy the economy, you might make $8.5 billion less than you expected. In particular “The settlement … covers 530 trusts with original principal balance of $424 billion.”
I am personally frustrated, because I hate Bank of America. When I was 17 I opened an account at BayBank (my mom had to cosign). This was a historic account, because it came with an ATM card which could be used in the one ATM machine in Harvard square (a competing bank had a big sign up saying they would have an ATM machine too soon). It was my first PIN number. It was also extraordinary because it was an interest bearing checking account (still banned outside of Massachusetts by regulation q).
So I never closed the account. I didn’t want to severe my tie with banking history and besides I was sentimental (yes I understand that people who are emotionally attached to a checking account need professional help).
Baybank was bought by the Bank of Boston, which was bought by Fleet bank (or vice versa) which was bought by Bank of America. The old checks still worked. Then Bank of America began charging $10 a month for accounts with balances below something. Now it does not cost them $10 a month to story my data (that would be less than a kb of data really less than 100 bytes, storing it with 999 backup copies costs 3.5 cents divided by the life of a hard drive in months (I also am emotionally attached to an 18 year old hard drive)). I’m sure they informed me of this charge in some bank statement (I’m eccentric but not eccentric enough to read bank statements for an account I don’t really use). So I found out that the account was in the red. I think they even extracted more money from me (yes people like me are born every minute).
And now they get away with paying only $ 8.5 billion.
Yes I am too old to be naive enough to think bankers will be held responsible. I blame myself — I should know not to click headlines which include “Bank of America.”