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Wal-Mart bank ignites regulatory row [Utah]
Financial Times ^ | February 21 2006 | Jonathan Birchall

Posted on 02/21/2006 11:29:56 AM PST by ncountylee

Wal-Mart, the world’s largest retailer, has encountered predictably stiff opposition to its efforts to open a small state-chartered bank in Utah.

Community bankers, independent grocers and labour unions have been fighting the move, arguing it could lead to the retailer providing a broad range of banking services that would further strengthen its dominance.

But Wal-Mart’s application has also reignited a much wider regulatory debate in Washington – over the status of state-chartered industrial loan companies (ILCs), described by Alan Greenspan, former head of the Federal Reserve, as a “loophole” in US bank regulation.

Utah currently licenses more than 35 such industrial banks, run by investment banks, carmakers and finance companies, as well as by Target, Wal-Mart’s discount store rival.

Target uses its Utah bank to issue its business credit card. Volvo, BMW and General Motors use the banks to operate car financing. Volkswagen’s bank also operates online and offers interest bearing certificates of deposit and mortgage lending.

Wal-Mart says it wants to use its Utah bank to cut credit and debit card processing costs and is not seeking permission for an interstate branch network

(Excerpt) Read more at news.ft.com ...


TOPICS: Business/Economy; Culture/Society; Extended News; News/Current Events; Politics/Elections; US: Utah
KEYWORDS:

1 posted on 02/21/2006 11:29:58 AM PST by ncountylee
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To: ncountylee

Have zero problem with this.


2 posted on 02/21/2006 11:30:29 AM PST by ncountylee (Dead terrorists smell like victory)
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To: ncountylee
Who ever would have thought that socialism would come from the corporations?
3 posted on 02/21/2006 11:33:21 AM PST by Vladiator
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To: ncountylee

I have a big problem with it.


4 posted on 02/21/2006 11:35:10 AM PST by bigsigh
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To: Vladiator

Modern corpos like saving money more than sex.


5 posted on 02/21/2006 11:37:32 AM PST by norraad ("What light!">Blues Brothers)
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To: ncountylee
I went to Wal-Mart bank and was only able to get this cheap Chinese money.


6 posted on 02/21/2006 11:42:49 AM PST by KarlInOhio (Next Olympics I want wide track bobsledding. Four sleds on the track at once - like Ben Hur on ice.)
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To: norraad
Modern corpos like saving money more than sex.

Since earning profits for their stock holders, not having sex, is the purpose of a corporation, I think that's understandable.

7 posted on 02/21/2006 11:44:51 AM PST by xroadie
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To: xroadie
Yes, it's very true, my angle is some corpos go at it like hitler in a bunker.

It can reck havoc on the folks like me who are trying to run the machinery of the corp. w/o enough oil to keep things well lubed, because some necktie nazi wanted to impress his inferior superior by saving on necessary expenses.

8 posted on 02/21/2006 11:52:09 AM PST by norraad ("What light!">Blues Brothers)
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To: ncountylee

Could you imagine the anger in the banking community when Wal Mart starts providing a host of banking and savings options at better rates than are currently being offered?
I think we would benefit from a Wal Mart bank.


9 posted on 02/21/2006 11:58:01 AM PST by pennboricua
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To: norraad
but they sure hate to pay it out in interest to the actual owners..the stockholders
10 posted on 02/21/2006 11:59:55 AM PST by M-cubed (Why is "Greshams Law" a law?)
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To: Vladiator
In the nineteenth century, Congress had been reluctant to regulate business. It often granted businesses absurd subsidies (for example, to encourage the railroads to expand across the U.S.), and regulated matters involving navigation, but for the most part, the governing theory was laissez-faire: leave the marketplace alone. In the twentieth century, Congress became increasingly interested in regulating business on a national scale--and there are several theories that attempt to explain why. One of the most intriguing is that presented in Gabriel Kolko's Triumph of Conservativism. Kolko, a socialist historian, unintentionally produced a spectacular defense of laissez-faire capitalism, demonstrating that most of the reason why Congress went into a frenzy of economic regulation in the Progressive Era (1900-16) was because the robber barons of the time were unable to figure out how to monopolize major industries--and so they needed the federal government's assistance.4 --

The above quote from Clayton Cramer's column in Shotgun News indicates it's not a new problem, either--(bold is mine)--

11 posted on 02/21/2006 12:02:32 PM PST by rellimpank (Don't believe anything about firearms or explosives stated by the mass media---NRABenefactor)
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To: pennboricua
Could you imagine the anger in the banking community when Wal Mart starts providing a host of banking and savings options at better rates than are currently being offered?

Wal-Mart's initial thrust will be a credit card and finance operation, just like GMAC, GE Credit and a host of others. That's a long way from general banking operations.

12 posted on 02/21/2006 12:03:38 PM PST by USS Alaska (Nuke the terrorist savages - In Honor of Standing Wolf)
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To: pennboricua
Could you imagine the anger in the banking community when Wal Mart starts providing a host of banking and savings options at better rates than are currently being offered?

The comic value of watching banking execs standing next to neohippies, all whining about Wal*Mart squeezing the little guy, would be worth it alone.

13 posted on 02/21/2006 12:04:14 PM PST by randog (What the....?!)
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To: bigsigh
I have a big problem with it.

What is the problem you have with it?

14 posted on 02/21/2006 12:10:06 PM PST by Antonello (Oh my God, don't shoot the banana!)
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To: Antonello

The state is blocking commerce.


15 posted on 02/21/2006 12:11:19 PM PST by bigsigh
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To: pennboricua

--I'd like to see them sell used cars--


16 posted on 02/21/2006 12:13:38 PM PST by rellimpank (Don't believe anything about firearms or explosives stated by the mass media---NRABenefactor)
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To: Vladiator
Who ever would have thought that socialism would come from the corporations?

The competition will use whatever means necessary to deny Wal-Mart any ground. They'd probably be willing to shoot themselves in the head if it meant Wal-Mart couldn't have it.

17 posted on 02/21/2006 12:15:51 PM PST by TChris ("Unless you act, you're going to lose your world." - Mark Steyn)
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To: bigsigh
The state is blocking commerce.

My apologies. I thought you were expressing that you had a problem with Wal*Mart's banking desires. Nevermind.

18 posted on 02/21/2006 12:16:28 PM PST by Antonello (Oh my God, don't shoot the banana!)
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To: rellimpank

The above quote from Clayton Cramer's column in Shotgun News indicates it's not a new problem, either--(bold is mine)--

The excerpt posted below from this link, The Destruction of a Wealth and Jobs Creator by Parasitical-Elites, is an excellent read.

The Destruction of a Wealth and Jobs
Creator by Parasitical-Elites

James J. Hill was a 19th-century railroad entrepreneur. Hill was an integrated thinker who broke out of a restricted, one-country mode and began pushing into a worldwide mode. Unfortunately, just as Hill achieved great success in the American railroad industry and began spearheading an international expansion, his worldwide growth was snuffed out by glory-seeking politicians. The story of James J. Hill is documented in the book The Myth of the Robber Barons by Burton W. Folsom, Jr.

 

Political Entrepreneurs Versus Market Entrepreneurs

In that book, Folsom identifies how throughout history there have been two distinct types of entrepreneurs: political entrepreneurs and market entrepreneurs. Political entrepreneurs seek profits by working with the government to get subsidies, grants, and special privileges. In other words, political entrepreneurs seek success through political pull. In contrast, market entrepreneurs seek success by producing increasingly improved products and services at increasingly lower costs.

The Destruction of a Wealth and Jobs Creator by Parasitical-Elites


19 posted on 02/21/2006 12:16:38 PM PST by Zon (Honesty outlives the lie, spin and deception -- It always has -- It always will.)
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To: Antonello

My reading is that the story is about the state blocking WalMart while allow competitors to do business. The comment I was responding to said they had no problem with that.


20 posted on 02/21/2006 12:21:19 PM PST by bigsigh
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To: Zon
--thanks--great link--and now,IMHO, about all we have are the political variety of so-called "entrepreneurs" because of the all-pervasive government at all levels--
21 posted on 02/21/2006 12:22:31 PM PST by rellimpank (Don't believe anything about firearms or explosives stated by the mass media---NRABenefactor)
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To: xroadie
Since earning profits for their stock holders, not having sex, is the purpose of a corporation, I think that's understandable.

Damnit, now I've got to rewrite these articles of incorporation!

22 posted on 02/21/2006 12:34:09 PM PST by Slings and Arrows ("I'd rather hunt with Cheney than drive with Kennedy." --fanfan)
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To: rellimpank
Many if not most politicians and bureaucrats are like pimps. They prostitute out the government power they wield and the money the extort from tax payers.

Some corporations are more inclined than others to seek out the politicians that will grant them an unfair advantage over the competition. It's gotten so bad that many corporations, could be considered negligent by its shareholders for not using the pimp service. Still, it's politicians and bureaucrats -- parasitical elites -- that offered the pimp/strong-arm service in the first place. It's a huge drag on the economy, research and development.

23 posted on 02/21/2006 12:40:31 PM PST by Zon (Honesty outlives the lie, spin and deception -- It always has -- It always will.)
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To: pennboricua

"Could you imagine the anger in the banking community when Wal Mart starts providing a host of banking and savings options at better rates than are currently being offered? "

Here in WV, banks are allowed to provide insurance services. Now there is an industry that could use some competition.


24 posted on 02/21/2006 12:49:13 PM PST by FreeInWV
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To: ncountylee

I hope wal-mart wins this.


25 posted on 02/21/2006 1:03:26 PM PST by Sonny M ("oderint dum metuant")
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To: ncountylee

Will Walmart suffer the same fate as Michael Milken? I wouldn't mind being offered the opportunity to borrow money to expand my business--I know I could do it with $--and if a Walmart was offering financing I'd turn to them after the bank turned me down...I suspect there are many others like me who could achieve beneficial results given the capital to engage their dream.


26 posted on 02/21/2006 1:30:03 PM PST by Simo Hayha (An eduction is incomplete without instruction in the use of arms to defend against harm.)
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To: ncountylee

bookmark


27 posted on 02/21/2006 2:55:22 PM PST by upchuck (Wikipedia.com - the most unbelievable web site in the world.)
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To: KarlInOhio

You are lucky - I went to one recently (in Dallas) and got pesos for change.


28 posted on 02/21/2006 3:43:57 PM PST by oldtimer
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