STOCK MARKET WATCH -- Wednesday, 28 March 2012

[Demeter]

27. Occupy Groups Reimagine The Bank by Margot Adler

http://www.npr.org/2012/03/27/149443425/alternative-banking-groups-aid-occupy-movement?ft=1&f=3

...Occupy isn't in the headlines so much these days, but work continues behind the scenes. The Alternative Banking Group of Occupy Wall Street meets weekly in different places. Members are older than some might think — in their 30s, 40s and 50s — and many work or formerly worked in the financial industry.

"We have almost no consensus opinion, except that the system is not working," says Cathy O'Neil, who often facilitates the group that is working on legislation and regulation to reform the financial system. "A lot of these people are from finance or have a background in law or SEC regulation. There's lots of people from banks and hedge funds."

She herself was a quant — a quantitative analyst at a hedge fund. She even worked with former Treasury Secretary Larry Summers for a while, but she got disillusioned. Within the Alternative Banking Group are smaller groups working on specific projects. O'Neil talks about their plans for a mobile app to help people move their money away from large banks.

"It would show you which credit unions you're eligible for, which is a big obstacle for people," O'Neil explains, "where the ATMs are in your neighborhood, what kind of paperwork you would need, and what the investing philosophy of that credit union is and what their services are."

...Another group wants to create a new kind of bank. One of the facilitators of the Occupy Bank Working Group is former British diplomat Carne Ross. He says it's amazing that the banking system is so broken that some people in finance share the concerns of people who were sleeping in New York City's Zuccotti Park — the heart of the Occupy movement.

"To the extent that actually we're talking about setting up an alternative system, that's pretty radical stuff," Ross says. "And the fact that you have Wall Street bankers, former regulators, hedge fund traders, as part of that project, I find pretty striking."

... this new bank, if it existed, would fulfill the values and ideals of Occupy Wall Street. "A bank that would be democratic, that would be owned by its employees and by its customers; it would be transparent, it would follow banking practices that did not expose the broader economy to systemic risk," he says. And ultimately, the dream is a national bank. Ross believes that if you change banking, you change the whole nervous system of the economy. But he realizes it's a tall order to take on the banking system. The regulatory obstacles are huge, and failure is very possible. The Occupy Bank Working Group is inspired by innovative financial institutions like the ShoreBank. Started in the 1970s, it was once the largest certified community development financial institution in the U.S., but it failed during the financial crisis...The group is looking to partner with or acquire an existing financial institution to create the Occupy Bank — democratic, transparent, accessible, competitive — but it shouldn't maximize profits over everything.

I SEE NO NEED TO REINVENT THE CREDIT UNION OR THE SAVINGS AND LOAN, BUT I'M NOT A BANKING INSIDER...