Move Your Money: Project Urges People to Stop Banking with Wall Street
Stay up to date with the latest headlines via email.
The following is a transcript of an interview with Robert Johnson by Amy Goodman for Democracy Now! about Move Your Money, a project to help people transfer their money from bigger banks into smaller, community-oriented financial institutions that generally avoided the reckless investments and schemes that helped cause the financial crisis. Robert Johnson is former economist at the Senate Banking Committee and the Senate Budget Committee. He’s now the director of the Economic Policy Initiative at the Franklin and Eleanor Roosevelt Institute.
Amy Goodman: So, Move Your Money, how did it come about?
Robert Johnson: Came about at a dinner. Eugene Jarecki, my wife Alexis and Arianna and I were talking about how frustrated people were that there was no legislative reform and there was no -- well, you might call “remorse” from the big bankers. So we started to just, how we say, bat the fat about what could be done. And we talked about how in past episodes people had sold stock, and in this episode, you could get people to move their money.
Why would they move their money when they’re happy with their services? Because they can get comparable services locally. Everything is insured by the Federal Deposit Insurance Corporation, up to $250,000. And they could stop this toxic side effect of derivatives lobbying and “too big to fail” lobbying that’s going on by the top five or six banks that --
Goodman: So, name names. Who are you saying people should -- which banks should they pull their money out of? And what banks should they put them into? Tell us what community banks are, but name the ones they should pull out.
Johnson: Citigroup, JPMorgan Chase, Bank of America, Wells Fargo and, to the extent that it’s asset management, Morgan Stanley and Goldman Sachs. Those are the six that have 97 percent of the derivatives markets. Those are the “too big to fail” institutions, or at least the large subset of the “too big to fail” institutions. But mostly, they’re the ones who are working very hard right now to stop Congress in the Senate from adequately reforming our financial system, which basically means they want to keep playing and making profit and have the taxpayer pick up the bill in the event of another—they hit another banana peel.
Goodman: And explain what community banks are.
Johnson: Community banks are small, regional or very much local institutions. Most of their activities, their lending activities and so forth, relate to the local region or community around which they collect their deposits.
Goodman: And how do know if you’re moving your money into a bank that’s not owned by one of the entities you just talked about?
Johnson: Well, that requires a little bit of research, but we do have friends at Institutional Risk Analytics that’s on this website, moveyourmoney.info, and they have rated all the FDIC call report banks, and they’ve separated out the big banks from the small, or what you might call the behind-the-scenes ownership, and given you a menu. If you plug in your zip code, it gives you a menu of the banks that they rate A or B, which is safe. And like I say, above and beyond that, you have deposit insurance. But those are the local banks that are independently owned, not owned by the big four to six.
Goodman: And explain what a local credit union is.
Johnson: Local credit union is like a cooperative in the local community, where people put their money in and essentially they are the owners of that bank or of that financial institution. It’s not technically a bank.