Posts Tagged 'crisis'

Seattle newspaper: Credit unions put members first

The Seattle Post-Intelligencer says there is one important lesson to be learned from the financial weirdness going on:

Despite the interrelated nature of the finance sector, credit unions are a safe and stable place to put our money. We ignore at our peril the lesson of the recent relative stability of credit unions…It is not just the fact that credit unions have better rates and didn’t indulge in precarious behavior. In credit unions [members], not investors, are sovereign.

Eric Bowman writes that the “financialization” of our economy – where money is made by moving funds around, not by producing anything of worth – is partly to blame for the housing, credit, and stock market mess. When banks strive for profit and not service, they make risky decisions.

Bowman argues that, by focusing on service, credit unions stay healthy for the long-haul.


$250 billion plan revision proposed by President



From Forbes.com, “The Ownership Society”:

In an effort to restore confidence to the ailing financial system, President George W. Bush on Tuesday announced plans to directly inject billions of dollars of capital directly into banks and expand the role of the Federal Deposit Insurance Corporation.

The plan–part of the $700 billion bailout package passed by Congress last week–will allot $250 billion for purchase of preferred shares in banks of all sizes and states of economic health. Nine banks have already agreed to take cash injections: Bank of America, Citigroup, Wells Fargo, JPMorgan Chase, Morgan Stanley, Goldman Sachs, Bank of New York Mellon, State Street and Merrill Lynch (which is being acquired by Bank of America). Treasury officials would not confirm the amounts that each bank will receive.

Thoughts on this revised bailout plan? Do you think it will help? Let us know in the comments.


Financial news you can use.

It seems everyday we learn something new about credit crunches, commercial paper, financial markets, and all those fun money terms we’re just now learning.

Being a news junkie, it’s hard to pry myself away from all the updates. I’ve found a few resources to help make sense of everything:

  • Bankrate.com – for nitty-gritty news
  • This American Life has two great hours of plain-talk radio programming – one on the mortgage crisis and one on the credit crunch. Must-listens if you want the full scope of the problem explained in ways anyone can understand. Download the free podcast version to listen to it at your leisure, either at your computer or on an iPod.

Where do you get your financial news?


Best way to bank? Don’t take our word for it.



We like to point out that, even in times of financial stress, credit unions like American 1 are a steady way to do your banking. Financially, we’re in great shape, and we continue to do all the great things we’ve always done – like this weekend’s Women’s Expo.

But don’t take our word for it.

Productivity blog Lifehacker helps sing the praises of credit unions, offering us not-for-profit financial institutions as a barrier to the weirdness out there.

“With major instability in banking and unprecedented failures and buy-outs, it may feel like the only safe place to put your money is under your pillow,” Lifehacker editor Gina Trapani writes. “While even through buy-outs like Washington Mutual’s, your money remains FDIC-insured, this is a good time to consider an alternative to for-profit private banks—like credit unions.”

Thanks Gina! And be sure to check out the comments section of the Lifehacker article for great comments from credit union members.


Financial crisis reading material

Last night the Senate approved the “bailout plan,” and it waits for a vote from the House tomorrow (Friday).

In the meantime, here are some articles on the hoopla surrounding the financial crisis. An informed investor is a smarter investor – and even if you don’t do much investing, this stuff is good to know.

  1. As Credit Crisis Spiraled, Alarm Led to Action: from the New York Times, a great timeline of everything that led up to the current situation.
  2. Washington Post Q&A: Readers ask questions about the situation.
  3. Topical Depression: Bernanke Knows What We Have to Fear: Richard Cohen explores how this crisis compares with the Great Depression.
  4. The Only Thing We Have to Fear Is Fear Itself: from Trent over at The Simple Dollar, telling us all to relax.

How are credit unions doing? Hunky dory, thanks.

Someone wrote into the Washington Post:

Q. What is the impact of the government’s financial rescue plan on credit unions?


A. The impact on credit unions seems quite minimal. These nonprofit cooperatives do not hold many of the investments that are poisoning other financial institutions, so they have weathered the crisis fairly well. Credit unions have kept about 70 percent of their mortgage loans on the books, meaning that they did not sell them off to other institutions, according to the Credit Union National Association. The group said that less than 1 percent of credit union mortgages were in delinquency at the end of the first quarter. Delinquencies on other loans have edged up to 1 percent. “If they’ve got their money in a federally insured credit union, they’re just hunky dory,” CUNA spokesman Patrick Keefe said.

Hear that? Hunky dory!



American 1 Federal Credit Union