Friday, September 26, 2008

My Bank Failed First

In another era, nearly everyone in Brooklyn got their mortgages at the Dime Savings Bank of New York. It had been around since 1859. Not as old as The Bank of New York, founded by Alexander Hamilton, but old enough for comfort.

I wasn’t part of that era, but when it came time to open a savings account as a teen on Long Island, the Dime at the mall was just fine. And years later, when I needed a mortgage, the Dime was familiar, and I got a relatively modest mortgage.

Then, several years ago, the Dime was gone, and suddenly my money was at a bank called WaMu, short for Washington Mutual. It made little difference to me at the time, not be a very money-minded person. I could have/should have looked into what was this Seattle-based banking entity.

But life is short, and only art is long, and I didn’t pay attention.

Well, they have my attention now. Splashed across the NYTimes “Washington Mutual was seized by federal regulators in what is the largest bank failure in American history.”

It is numbing to have your life savings in a bank that has completely failed. Both the Federal Government, under FDIC, and JPMorganChase have stepped in to buy the assets. It was business as usual in the bank today. There was no run on at the teller lines, no particular panic. All the info on the websites we were directed to said that we had had an account at WaMu, and now we will have one at Chase. Very orderly.

Still, it’s a sickening feeling. Middle class means always having to worry. Heavy tax burdens, and no programs to help. The middle class spends a lifetime just staying afloat. But the system has to be in balance for it to work.

The Federal Deposit Insurance Corporation meant that eligible, insured funds were backed by “the full faith and credit of the United States Government.”

Right now, I’d rather be protected by reason and “the math” rather than the government’s faith and credit.