Brunch & Budget

b&b236: What if you could create your ideal bank?

September 02, 2020 Brunch & Budget
Brunch & Budget
b&b236: What if you could create your ideal bank?
Chapters
Brunch & Budget
b&b236: What if you could create your ideal bank?
Sep 02, 2020
Brunch & Budget

How many of us really love our bank? It feels like an entity that we have to do business with but always begrudgingly and always with a hint of how are they going to screw me over this time? In this episode we talk about this history of banking and how it got to be this way through various acts of deregulation and how we can ask our banks to do better.

Show Notes Transcript

How many of us really love our bank? It feels like an entity that we have to do business with but always begrudgingly and always with a hint of how are they going to screw me over this time? In this episode we talk about this history of banking and how it got to be this way through various acts of deregulation and how we can ask our banks to do better.

Dyalekt :

Just like hot pickles and when your ex says they don't miss you justice is best served with a side of tissues for your issues. Welcome to brunch and budget the show about personal finance and racial economic inclusion with your host, Pamela Capalad. A certified financial planner and accredited financial counselor here to take the bite out of your budget. Brunch & Budget is part of the Race and Wealth Podcast Network. I'm your sound provider Dyalekt and here's your host, Pamela Capalad.

Pamela Capalad, CFP, AFC :

Thank you Dyalekt and thanks for holding it down last week.

Dyalekt :

Oh yeah, I was there. It's funny. You know, I was just thinking about as I was doing the intro, I was like, Oh yeah, we don't we're not saying recording live anymore, even though we're recording live. Yeah,

Pamela Capalad, CFP, AFC :

Yeah, we're just here.

Dyalekt :

Recording live from where we reside.

Pamela Capalad, CFP, AFC :

Yes. Wherever you reside. Thank you COVID. Okay.

Dyalekt :

Well, thank you for having a home.

Pamela Capalad, CFP, AFC :

Yes, us having a home is great. So, yes. And to get our home, we have to use a bank.

Dyalekt :

Yeah, there's a bank. It's one of the biggest things about talking about this issue. We're talking about banks, building a better bank and what we want to talk about making banks equitable. And it's this thing where we often go into schools and work with young people and talk to them about banks in the banking system. And one of the first things they say is I don't trust banks. Yeah. And all I can say is, even when we're getting sponsored by a bank to go in there, I'd be like, good. You shouldn't you shouldn't trust banks.

Pamela Capalad, CFP, AFC :

Banks are not trustworthy. Banks have not been trustworthy for a very long time. We're going to talk about how that happened and why but this is not the world of It's a Wonderful Life with like, you know, Jimmy Stewart and a savings and loan anymore.

Dyalekt :

Oh, wasnt It's A Wonderful Life where like, the evil banker came and took over the whole town?

Pamela Capalad, CFP, AFC :

There was atleast a savings and loan.

Dyalekt :

Okay, what was that? Whoa, let's get right into it. So wait a second.

Pamela Capalad, CFP, AFC :

Public banking? Yes. Ooh, that's one of my ideas, too.

Dyalekt :

So like it's a savings and loan. So wait, why is It's A Wonderful Life bank, not the Bank of today. Oh, let's talk about right cuz it already seemed like it was all the stuff, you know, the mortgage and you couldn't pay it.

Pamela Capalad, CFP, AFC :

No, you're right. And let's talk about that because banking has a long history in the United State. Of course, pre Civil War was kind of wild. It was like states regulating it, the nation was regulating it, there was no way to like address the growing and expanding US economy, blah, blah, blah, all that stuff. So right around the Civil War, they created a national Banking Act of 1863. So all banks had to be nationally chartered. They could not be regulated only by the state. They had to be regulated nationally. Yeah. And this i'm sure helped with like interstate commerce and things like that, as well.

Dyalekt :

You know, when we talked about the history of stuff, like I was just like, Hey, you know, I know we're looking at regulations. Let me look about the beginnings events in the US and Alexander Hamilton, which you guys may know from playing Disney's Mary Poppins. He helped put together the Bank of the United States in Philadelphia, they called the first bank nowadays, it was just called the bank then because they have no other thing. Yeah. And it only lasted about 20 years. And one of the big problems with it is that it was a Federal Bank and the states and private institutions they were afraid of competition.

Pamela Capalad, CFP, AFC :

Yep, yep, exactly. Well, the thing is that banking,

Dyalekt :

Just like FedEx andUPS today. Just saying

Pamela Capalad, CFP, AFC :

Oh, yeah, totally. State USPS y'all. The thing about banking is that it has been pushed to be privatized for a long time. There is a lot of fear around the government regulating banks, even though let's be honest, like we treat banks as financial institutions and not businesses. Banks make money banks are businesses, banks are some of the biggest businesses in the world.

Dyalekt :

I was at least 20 something when I understood that a bank was different from the post office.

Pamela Capalad, CFP, AFC :

And a bank makes money, right. And a bank makes money in very specific ways. And in very complex ways nowadays, and like, let's go through the reason why that happened and how that happened. So the history of banking is super important because it helps us understand how we got to where we are today and how every set of regulation throughout history has been created around the banking system because somehow, a few wealthy white men figured out how to continue to concentrate the wealth, right. And so we have the national maniac in 1863 so that the banks have to be nationally chartered

Dyalekt :

Because that's from you know, we were talking about Hamilton with that first thing, that's 1790? So it's a whole lifetime of people just doing whatever they want.

Pamela Capalad, CFP, AFC :

Yeah, basically, and like regulating however, so that was the beginning of regulation, the Federal Reserve Act of 1913, actually created the FED. And the reason why they created the Fed was to have a more they call it elastic economy. Basically, it's just the Fed, being able to have a way to control inflation have a mechanism for controlling inflation, as the economy is expanding and contracting. To make sure the value of the dollar still maintains its value, essentially. And so the Fed is a very important instrument, although we've seen the Fed recently, especially during COVID, you know, do whatever the fuck they want,

Dyalekt :

Which was when I was like, maintaining control over us like, they're maintaining a hold on it.

Pamela Capalad, CFP, AFC :

So and the Fed is this whole big thing. And then I'm in 1933. So this is in the middle of the Great Depression. You may have heard of the Glass Steagall Act and the Glass Steagall act coming under attack in recent years in recent decades. But the Glass Steagall act of 1933 was some of the biggest most important banking regulation in the United States. One, it created the FDIC, because the bank run in 1929, they were like, Oh shit, everyone wants to get their money ou and we had no more money in there, right? The banks basically didn't have enough money when there was the bank run in 1929, to actually be able to say, okay, we can give you your deposits back and we'll still be fine. So the FDIC, the Federal Deposit Insurance Corporation was created through the Glass Steagall act to basically protect banks and also to protect people who were banking, right? To be able to protect borrowers to be able to protect depositors, all of those kinds of things. The FDIC is basically insurance so that if a bank were to go under if a bank were to go bankrupt, then the FDIC would step in and make you whole

Dyalekt :

I mean, this is the reason that I think a lot of people think of banks as a public service. Because they are so guaranteed by something that was created for the public good

Pamela Capalad, CFP, AFC :

It's safe, right? It's a safe place to put your money that's the whole thing. The FDIC is whole like marketing thing was now it's a safe place to put your money you'll be able to get your money back

Dyalekt :

Created by regulation.

Pamela Capalad, CFP, AFC :

Yes. And with that, with the FDIC, with the Glass Steagall act of 1933, it for the first time separate commercial banking, from investment banking. And this is extremely, extremely important. So I want to break this down because we hear about investment banking, we hear about commercial banking, we hear about investment making mortgage backed securities, derivatives, all of that kind of stuff that banks have been able to do now. The Glass Steagall act of 1933, separated commercial banking from investment banking, and the difference between the two is commercial banking is what we think of. The savings and loan that I was talking about Jimmy Stewart, right? Savings and loan commercial banking is all just deposits and loans, deposits and loans, people deposit money in the bank, the bank turns around and loans it out. This is the main way that banks have made money. This is the main way that banks make money, in general still on the commercial banking side on the consumer side is, hey, I want to save some money. I'm going to put in a bank, I'm going to get some interest to put the money in the bank and the bank is going to turn around and lend it so people can buy houses can buy cars can start businesses all that kind of stuff, right? Yeah. simple concept

Dyalekt :

Well, and that's another reason why we don't think of banks as the same kind of business because rather than the usual transactional thing, we're doing business. With the bank, we're making money together, I want you to take my money and loan it out, because it's gonna make me more money.

Pamela Capalad, CFP, AFC :

Right? Exactly. Well, and I one day want to be able to buy a house. So I build a relationship with a bank, I deposit my money there, and then they know who I am. And it's going to be maybe easier for me to get a mortgage and to be able to borrow money from them. Right. And so there's also this despite being nationally regulated, there's this more like a neighborhood community feeling with banks, when they were simply commercial banks. So this lasted for a while. This lasted for about 50 years, the Glass Steagall act of 1933 that banks still grew in that time.

Dyalekt :

I mean, to be real, they tried to repeal it within two years. Yeah. Because, you know, because of lobbying,

Pamela Capalad, CFP, AFC :

I didn't talk about investment banking. So investment banking on the other side of it, and this Glass Steagall act separated commercial from investment banking. Investment bank, is the ability for a bank to buy and sell stocks and bonds on behalf of companies. And so that's the basic premise of investment banking. And it's much more lucrative for financial institutions to be able to do investment banking. So the fact that the Glass Steagall act separated commercial banking from investment banking was a big deal. Because they said, Nope, as a consumer, you should just be able to put your money in and deposit it and then borrow money from the bank if you want it. And that's the simple transaction, right? investment making made things way more complex and way more dangerous and risky for the consumer. And let's talk about that. Because the reason why the Glass Steagall act was actually deregulated in the 1980s was because banks were like, hey, commercial banks, I should say, We're like, hey, this isn't fair. We're super regulated. All these financial institutions are doing investment banking, they called it American banks were less innovative and competitive than other financial institutions who are not regulated. And so these American banks, these commercial banks were basically Just like helping consumers save money and buy homes and all that stuff, not too fancy and banks were like, That's not fair. Why are these other financial institutions who are not regulated able to make a shit ton of money investing and we're not? And so in the 80s, there was actually, what was the thing? The wave of deregulation started in the 1980s. And the first one was, I lost it hold on. The first one, it was actually in 1980. With the depository institutions deregulation and monetary Control Act, which allowed financial institutions that were not banks to also accept deposits.

Dyalekt :

Depository institution deregulation.

Pamela Capalad, CFP, AFC :

Yeah, they didn't even have an acronym. Oh my god. So the thing about this is what the 1980s did in the deregulation in the 1980s was it allowed banks to both be commercial banks and basically support the consumer and patronize and the consumer can patronize them. But also it allowed banks, commercial banks to take on investment banking. Now that to me, I don't know about your Dyalekt, but feels like a little bit of a conflict of interest, right? Let's break this down. Because we saw what happened, the effects of it 20 years later in 2008, with the Great Recession. With the mortgage crash with the mortgage backed securities, derivatives. All of those things, the craziest thing, let's break this down for you. So on the commercial side, right, you want to buy a house, you get a mortgage, and the bank issues you mortgage and the way the bank makes money from that mortgage is they collect interest over 30 years, 15 years, however long your mortgage is right? They collect interest, often very simple transaction. That's how they make money. And they serve as the middleman between the people depositing money and then the people who need to borrow money, right. And that's very straightforward. mortgage backed securities was something that banks were allowed to create because they now were able to be investment banks.

Dyalekt :

So once they have that, then they can move on to the next.

Pamela Capalad, CFP, AFC :

Yeah, so mortgage backed securities allowed banks, commercial banks to bundle all of these mortgages and sell them to investors on a secondary market and wipe their hands of the mortgage. So they're like, Oh, we don't want to wait 30 years to collect all our profits, let's put them in these mortgage backed securities and sell them to investors. And then investors will hopefully collect money on these mortgages, right?

Dyalekt :

Well, as you continue to add more and more things that these banks are doing, we get more hopefully's and maybes and a lot of wishful thinking, which takes us away from this whole safe institution that we thought banks were supposed to be when they got the first piece of regulation placed.

Pamela Capalad, CFP, AFC :

Well, that's the thing that's scariest about it is on the consumer facing side we're like, Oh, I'm keeping my money here to save. I'm borrowing money when I need to do something big like buy a house or you know, buy a car, whatever it is, start a business, all of those things. And that's all I see on the banking side. That's me, that's me as a consumer on the investment banking side. On the other side of it, a bank is turning around and saying I don't want to wait 30 years to collect all my money. So maybe I'll just sell this loan to an investor and let them wait to collect all the money and I get to like, I get to basically get all this money now and not have to wait and then I don't have to worry about the mortgage being paid. So the banks basically don't have to worry about you paying your mortgage and this is how subprime mortgages became a thing because the bank didn't care he was getting a mortgage.

Dyalekt :

By the way subprime if anyone didn't know like is it's passed and it's been a minute right? By subprime doesn't even necessarily sound bad subprime actually sounds fairly neutral. Okay. Right subprime. It'd be like, Hey, What's the name? JOHN Moran just won the was the rookie of the year last year and like, you know, he's subprime. He's not in his prime yet, but he's good. Yeah. subprime doesn't sound terrible. What subprime loans were, were loans that shouldn't be made. These were no's. These were things that were in the no pile.

Pamela Capalad, CFP, AFC :

Yeah, exactly. And so the thing about the subprime mortgages is because banks didn't care about waiting 30 years to get to basically make a profit on someone's mortgage, they were able to package them in the mortgage backed securities. They were incentivized to approve as many mortgages as possible, because they knew once the mortgage was closed and the person got their house, they're just going to turn around, sell it in these mortgage backed securities and make that money as soon as possible and make that money right away.

Dyalekt :

This is what they meant by need to be more competitive. They don't mean more competitive with each other. They don't mean making better service. They mean being able to take all the money, all the money with the littlest effort, right?

Pamela Capalad, CFP, AFC :

Yes, and they wanted their profits right away. They didn't want to wait. That's the thing. That's the tricky thing about having a commercial bank also have the ability to be an investment bank is a commercial bank is we're taking care of our customers. An investment bank is we're taking care of our investors. And those are two very different people. And so when you have those two merge, what happened in the 1980s. You have things that happen Like the Great Recession. You have things that happen like, even though 50 million people are out of work, the stock market is doing better than it did in January.

Dyalekt :

You know, however it is if you ever want to rap about, you know, if it always seems like whenever we're talking about big changes in American financial institutions, we're always like, oh, around the 70s 80s, all this stuff kind of flipped. There's this term, the Great Divergence about what happened in 1971, where basically everything about what the United States was all about in terms of money completely got flipped on its head, maybe we should like find an economist. Yeah, like a good rap on that so that we can break down with this comes from.

Pamela Capalad, CFP, AFC :

But this is the beginning of that, again, all of these regulations that the US government were trying to implement for banks were done in service of not having the money concentrated into a small number of hands. So the Glass Steagall act of 1930 was like, nope, banks can't do anything shady. They can only do what they do, right? They can only function on their function. When they deregulated things in the 1980s, it began that continued concentration of wealth that we see now, right? That we see today. How we have billionaires and trillionaires.

Dyalekt :

Very similarly to when the FDA was enacted and it was like at first it was like, okay, the FDA is gonna make sure that food is food. And then when we get to today we have stuff like, do you know about wings, if you see WYNGZ wings, that is the legal designation for something that is vaguely chicken, but it's definitely not a wing.

Pamela Capalad, CFP, AFC :

It's not a chicken wing, don't eat wings,

Dyalekt :

The lobbying was so intense that I found a quote here from President Obama when he was in his campaign and talking about the financial reforms that need to be made. And he said, By the time the Glass Steagall act was repealed in 1999, it was repealed kind of de facto repealed by Bill Clinton, the $300 million lobbying effort that drove the regulation was more about facilitating mergers than creating an efficient regulatory framework. I want to talk about that because I was saying, you know, the whole thing about, you know, efficiency, and being able to be competitive

Pamela Capalad, CFP, AFC :

Right innovative and competitive were what banks were complaining about, they couldn't do under regulation.

Dyalekt :

Right. And that's the whole game of it, but what actually ended up happening was a bunch of mergers and a complete loss of any sort of competition.

Pamela Capalad, CFP, AFC :

Just to give you an idea. In the 1980s, there were about 15,000 different banking institutions and that shrunk to about 8000 banking institutions by 2008. It didn't get more competitive.

Dyalekt :

And to explain what , it was not exactly repealed. It was de facto repealed by being replaced by the Gramm Leach Bliley act law. Worst one, yeah. So you know that we're drowning? Yeah. And so that was signed into law in 1999. So basically, all of those fun, good money making times of the 80s and early 90s was over by then.

Pamela Capalad, CFP, AFC :

Yeah. Well we saw that, right. We saw we went through a recession in 2001 2002. We went through another recession in 2008. I don't know what the hell is going to happen right now. Because the stock market is again, not reflective of what's actually going on in the economy, what's actually going on in people's wallets and in people's bank accounts. So the fact that commercial banking and investment banking were able to merge in the 1980s has led to us having billionaires, another concentration of wealth and something has to change, right? Something has to change. So let's go to a song.

Dyalekt :

You might see like weird faces on me I'm like I decided as we're looking through it, I'm pulling something up, I found an article that was like anti Glass Steagall. It's like the myth and the reality of the Glass Steagall act. And it keeps asking questions about like, so the Glass Steagall, did it actually help things in the 1930s? Did it actually help with the depression? But anyway, so rather than allowing ourselves to get distracted by the folks who want to make things worse, we're going to go into some artists who want to show us how to make things better. And to start off we're going to Elect Recordings out in Seattle, who are these MC's, Savant, Dre Murray and Sojourn for their joint better,

Song :

Yeah. Your boy Blake is in the building. Hey, Shout out to freshco Steve is still up chairs issue transition so say no the skinny skinny people don't know but these listeners tripping neighbors sipping no too many beers don't hate homie get your bars up you know my flow become at heart like popcrush give money give money and then we trusted life is a bitch that's a chick I would never love never I would only love loss we don't have time we make beacon light we have different minds different so with that said what is patient grind making shorter versus on point like a porcupine ha Nick is talking keep talking to the grapevine like I that both blinkers keep coming number gray line oh gosh system buddy to stop him but that kind of hard to do when he's chopping chopping butter Unique is already know that God knows options bullshit to business rags to riches I'm hoping I could gain a spot to put on my niggas my niggas we headed for the top dog close to pick the lock fubu shit the business rags to riches Oh hoping I could gain a spot to put on my niggas when I put on my niggas we go to the top we headed for the scam came from blah how naevi gotta speak nice versus unnecessary push it by is like a blackberry so as Sean just shown that I'm not worried now worry hard cold like February got so many style sounds just made very homey said on what the shit is funny like Jim Carrey chase sudden, like written supervision Sunday there for men the competition like putting the golf cart against Safari. He What's the chances of that golf cart even witness you know how you niggas mess sick with the gun God got it got it rags to riches hoping that you gain a spot to put on no my niggas my niggas we had it for the top dog close to pick the luck oh shit the business rags to riches Oh hoping that to gain a spot to put on all my niggas my niggas we go into the top, we headed for the skies came from

Pamela Capalad, CFP, AFC :

Yes, Onot from Kansas, To be honest I think the stock market is just there these days for politicians to show off how successful our economy is when it isn't.

Dyalekt :

But by these days you mean like since, always.

Pamela Capalad, CFP, AFC :

Since always. It's a thing people can point to. And I will give you another stat not from Kansas. 47% of Americans do not own one stock. Half of the country is not invested in the stock market. So what the hell is the stock market actually reflecting?

Dyalekt :

Well, and you know, when you talk about like that 50% 53% are invested. It's not like all 53 of those have, like huge portfolios.

Pamela Capalad, CFP, AFC :

Yeah, exactly. They're probably like 401 K plan that that doesn't count. People just own one stock, right. And so that's the thing to think about here. When we look at the stock market, and we look at how banks went from, I'm going to take deposits and I'm going to lend the money out, right, because that is the main way that banks make money. Banks make money other ways now to on the commercial side. So banks make money from loans. That's the main thing. Banks also make money from charging bank fees, which we're all familiar with. It's one of the main reasons that people don't trust banks. And just to give you

Dyalekt :

Check out landed the fee from the homie Devin Fergus. We talked about that on the race and wealth Podcast Network and one of those shows where he talks about a lot of those fees and how that is torn down the American middle class.

Pamela Capalad, CFP, AFC :

Oh yeah, no cuz banks charge ATM fees, overdraft fees, monthly fees, wireless fees. In 2017 alone, banks made $11.68 billion in overdraft fees. Just overdraft fee's.

Dyalekt :

And think about the fees from all the minimums that come around if you have a low balance minimum and be below zero minimum. When I think about overdraft I think about all the below zeros that always end up a company. Yeah, the overdraft fees.

Pamela Capalad, CFP, AFC :

Yeah. And gotts love credit unions. Yes, yes credit unions are the jam. They are great. They're great. They have their pros and cons, of course, but credit unions are nonprofits that are not allowed to make a profit. So they don't do investment banking. They are the savings and loans in the neighborhood often.

Dyalekt :

Yeah, and it's something it's very weird. We think of profit as a proof that your business is doing well. I don't know how many times I've heard someone say, Oh, I want to start a business, I want to start a bank or started this thing or that thing. But I don't want it to be a nonprofit because I want it to be good. I want to do its thing. And people have this idea that just because something doesn't make a profit, that it's not working to make money that's not innovative, and that it doesn't grow. Yeah. Which is all nonsense.

Pamela Capalad, CFP, AFC :

Exactly. It's all nonsense. So the thing about banking is, the other thing is, let's say you don't take out a loan from a bank, you don't get charged bank fees, right? You're like, Okay, I'm so good. I never overdraft, blah, blah, all this stuff. Do you use your debit card, because if you use your debit card, then banks still make money off of you. You don't see that payment, because the merchant is the one who pays it. But banks make money on what's called interchange fees. So every time you swipe your debit card, a bank charges a fee to the merchant, and they collect it. And that's another way that banks make money.

Dyalekt :

Well, and that's why sometimes when you sign up with a bank, they'll say like, you need to swipe your card 10 times in a month, and we'd like something like that a high number like eight times 10 times like that or else we will charge you a fee. Because if you're doing it a 10 times a month, then they're having the interchange fee. And then they're good money.

Pamela Capalad, CFP, AFC :

Yeah, exactly. So banks take money from loans, bank fees and interchange fees. That's the basic stuff as a consumer. Guess what, though, because banks are deregulated. And both on the commercial side on the investing side, they're also allowed to offer you an IRA. They're allowed to do payroll for your business. They're allowed to sell you insurance. They're allowed to sell you an annuity. They're allowed to sell you all of these different product lines to make you a more profitable customer if you're qualified to get all of these products.

Dyalekt :

Well, and these sounds like a lot of financial products and services that I guess I mean, I feel like since I've been doing this stuff with you now I know enough about banks to know that those things aren't really related. But to the layperson, it's like, hey, it's a money thing. Right? The bank can do it. That's why I think a lot of us don't question it.

Pamela Capalad, CFP, AFC :

That wasn't the case before 1980. All banks could do was take deposits and loan them money. And that was it. That was their function. They were the middlemen to do that. And that's the thing too. I thought banks had a good deal. They didn't even have to make money. They made money on charging interest to do that one transaction. And that was it. That's all you had to do, right? And banks basically were like, We don't have enough competition, we're not innovative enough. And they basically were able to tap into selling all of these other financial products to people. It's why when you go in, and if you have a certain level of money that you're about to deposit to the bank, they'll sit you down with a banker. They'll try and get you to be a private client. They'll do all of this stuff for you. They'll sit you down and say, Hey, do you need insurance? Hey, do you have an IRA? Do you have an old 401k Do you need a financial advisor?

Dyalekt :

How many of you when you've gone into a bank have never had that happen? Right I feel like that's most of us. Oh that experience that you talk about? I'm like what, bankers talk to you? Yeah, like I knew my teller cuz they were nice people, but then they you know, got a better job or got fired. So that wasn't like a long relationship. Yeah, I want to shout out now again to saying that so weird because I'll pick a credit union with a car lot and zero in Interest rates on student loans and all that pizzaz over a bank that's super shady, right?

Pamela Capalad, CFP, AFC :

Oh, yeah, definitely. Well, that's the thing too. The thing that's frustrating about banks that make all this money is they never talked to me. Yeah, I know. I never got to sit down.

Dyalekt :

Yeah, I never got those things. With the first time you talked about my banker, I was like your banker, like you mean like your DJ?

Pamela Capalad, CFP, AFC :

Well that's because I went with Amalgamated Bank shout out to amalgamated their regional bank. They're socially conscious bank. They're awesome. And so I actually sat down with a banker when I opened my business account.

Dyalekt :

I've had people kicked me out for being too young. Well, cuz that's the thing. Yeah. What I have experienced with going to a bank, the person who talks to me is security. Yeah. When you walk in there and like you got your deposits and your stuff. And I remember like, I'm just like, trying to get it together. And I've got my handfuls of it. My Folder, my envelope, and he walks up to me, he's like, Hey, where are you supposed to be here?

Pamela Capalad, CFP, AFC :

Well, and that's the thing. This is what happens when the bank makes more of their money from investment banking then from commercial banking. They don't care about the customers because they don't need to.

Dyalekt :

It's like that thing from supersize me about how McDonald's makes its money from real estate and not from selling burgers and that's why when you went to the Time Square McDonald's you could use the bathroom without anybody telling you nothing. But when you went to the one in Harlem, they had a security guard outside the bathroom.

Pamela Capalad, CFP, AFC :

yep, all the same thing. It's all the same.

Dyalekt :

I just like calling banks McDonald's so you can see how gross they are.

Pamela Capalad, CFP, AFC :

They are pretty gross. They are gross like that. And that's the thing too is it's why people don't trust banks because banks don't have our best interests in mind. They just don't they make way more money from going to these big investors. Let's talk about a recent thing that happened let's talk about PPP loans right.

Dyalekt :

Yeah PPP loans. Everybody was going to the banks it's a public service supposed to help everybody out.

Pamela Capalad, CFP, AFC :

They were if you if you're not familiar Paycheck Protection Program loans. I know we talked about it a lot on the show because it was basically allowing people to get forgivable loans and allowing small business owners to get forgiven without To get through this COVID time. What ended up happening though in the first round of PPP loans was any business that was less than 500 employees was allowed to apply for a PPP loan because they're considered a small business,

Dyalekt :

A lot of technicality money went to very big business.

Pamela Capalad, CFP, AFC :

And there was another technicality that restaurants that had less than 500 people in one location could also apply for the PPP loan.

Dyalekt :

You could have a national chain, but each location was under five.

Pamela Capalad, CFP, AFC :

So what JP Morgan did was they cherry picked their biggest corporate clients, their biggest investment banking clients, and they said, Hey, I'm going to help you apply for this PPP loan and get $10 million for your business. And that is how the first round of PPP money ran out in less than a week and a half.

Dyalekt :

And the banks did this because it made them money to be able to loan out these bigger sums to these larger companies. Because they weren't gonna get $10 million worth of loans from all of these small businesses.

Pamela Capalad, CFP, AFC :

Well, if they were they were gonna get it and have to service 1000 businesses, not just one

Dyalekt :

Well, well, let me ask you so do you think that these bad Did this more maybe it's equal but like was it more for the greed of more money or more for the ease of we only have to deal with five companies?

Pamela Capalad, CFP, AFC :

Definitely definitely both. I know oh yeah this is a good comment too.

Dyalekt :

Oh yeah from Not from Kansas, I hate the insurance sold by banks. I feel you they usually the worst basically stealing your money that's a tough thing with insurance. Insurance like all the other financial institutions with the uneven regulation that it seen. There's some insurance that's good for you. We brought books on we've talked about some insurance that you could use but so much insurance is such a mess.

Pamela Capalad, CFP, AFC :

Thank you NY dragons.

Dyalekt :

I need to put that out there that like yeah, it is both things happening. Yeah, mind blowing that even one does.

Pamela Capalad, CFP, AFC :

Well, that's the thing. It's why there's like a private client division and investment banking division. When I worked in wealth management, most of the clients had a private banker that would basically help them open a checking account savings accounts, get a mortgage, manage their investments. They got to use the banks bathroom. When the fuck have you ever used a bathroom in a bank? Did you know, banks have bathrooms? Like what? are bathrooms?

Dyalekt :

I know executive suite bathroom

Pamela Capalad, CFP, AFC :

For your private clients. That's right. No, it's wild. So what would an ideal bank look like? Yeah, like we talked about the history, we talked about how basically, wealth has been concentrated again, in the hands of a very small amount of people. And that was a direct result of deregulation, and the Glass Steagall act basically becoming an effective with those acts from 1999. And also just like a series of deregulations. But like no, truly like the fact that banks are so deregulated right now and are so able to be to have these complex products that have nothing to do with the people that we think they're serving us, is the reason why banking has gotten so shitty. It's the reason why we don't trust our bank. It's the reason why we can't actually feel comfortable leaving our money in a place, right? It's the reason why we're like, oh, I don't think I want to do this. It's the reason why we talk to kids and they're like, I'm just going to leave my money under my mattress, it's safer there.

Dyalekt :

Yeah, even after we have the conversation with them, they're like, oh, mostly my money and my mattress until I have to go and get a loan and then I'll figure out the bank stuff. It's why people who have access to credit unions love their credit unions.

Pamela Capalad, CFP, AFC :

Yep, yep. Exactly. Because it feels like the bank that you see in It's A Wonderful Life. Because they don't have incentive to do much more than savings and loan. Did you find the app?

Dyalekt :

Yeah, yeah. The glib law, the glib bla bla.

Pamela Capalad, CFP, AFC :

Yeah, no. So deregulation is terrible. My big sweeping reform would be to re-regulate things.

Dyalekt :

Because that's the thing I wanted to rap about real quick is like, do we want to re regulate banks? Or is it possible to reregulate banks, or do we have to just make new systems like, I've always been saying about how with the gig economy and what's going on now, we can't really just call in unions to come and do this because so much mess has been done that we need a new entity that does what unions did for those types of companies for the gig economy.

Pamela Capalad, CFP, AFC :

Well, Obama did try in 2010. I don't know if you recognize the name Dodd Frank, the Dodd Frank act of 2010 was again trying to re regulate banks and to say, hey, you can't do all this stuff. They created the CFPB. The I've read the Consumer Finance Protection. Thank you. I'm like where

Dyalekt :

did that go home as we love the CFPB. The

Pamela Capalad, CFP, AFC :

CFPB is currently getting defunded right now,

Dyalekt :

you got defunded all the heck did they cut all the teeth out of this team? The director was replaced with like a homie. They went from doing the CFPB their big thing was doing lawsuits on behalf of consumers and making sure that creditors and other people who were acting unfairly but in ways that didn't have criminal penalties. They didn't have to pay and one ill stat was they started out where they were doing at least a lawsuit every single day. Helping out consumers, and then when the regime change came and when they cut all the funding that dropped to like maybe one a month?

Pamela Capalad, CFP, AFC :

Yeah, so the thing about the Dodd Frank act is it attempted to reregulate and specifically targeted stopping mortgage companies and lenders from taking advantage of consumers. So the subprime mortgages that basically crashed the economy, but did not bankrupt banks who are too fucking big to fail, right, whatever that means. So the reason why banks were also too big to fail, is because they were commercial banking and investment banking. They were involved in so many complex aspects of the US economy, that it's true. These banks were too big to fail. They were so entrenched in what was going on with the economy, that if they fail, then the economy would fail too. And so the Dodd Frank act was an attempt to say hey, we saved your asses Now come back and don't do this shit again.

Dyalekt :

Yeah, although like the whole too big to fail thing does run counter to the whole idea of competition. If anyone is too big to fail, then the system Has

Pamela Capalad, CFP, AFC :

right then the system is done.

Dyalekt :

Right? The system failed, right? There's no way that it works for You're too big to fail. That means that you are if not a monopoly than a functional monopoly, right?

Pamela Capalad, CFP, AFC :

No, totally well, because the thing is, if you're too big to fail, then that totally wipes away this whole idea of fair market, right? This idea of free market like, oh, let's just see what happens. And let's not have any government regulation and all this stuff. How can you have a free market also have institutions that are too big to fail?

Dyalekt :

Mm hmm. And what what is how do we decide can't fail other than just size? Yeah, I should, I should sue and be like, yo, every time I put out a record, and it wasn't platinum, you know, I should get money for that because you know, I'm too big to fail.

Pamela Capalad, CFP, AFC :

Yeah. Where does that come from? Right.

Dyalekt :

I'm about five feet. That's big.

Pamela Capalad, CFP, AFC :

There you go. No, but really, and truly the direct result of deregulation was this combination of this free market this concept of free market competition, but also more smaller banks, merging with larger banks, and getting acquired by larger banks, and also in 2008, this concept of bank seems to get bailed out. And that carried over today into 2020. We're not only banks too big to fail, but huge corporations were also too big to fail when it came to the Fed actually pumping money into the stock market and saying, Hey, we can't let the stock market crash right now. It's too big to fail.

Dyalekt :

Yeah, and what all of that stuff is if you're like, trying to get a handle on what like the whole free market competition thing is is that in reality, it's when you're bully becomes the hall monitor. In House Party 2 when full force the bullies from for kid and play when they got the job as campus security? We were watching during COVID.

Pamela Capalad, CFP, AFC :

that's never okay. So deep re-regulation would be my big dream. My big nerdy dream about putting banks to what they were and and creating an ideal bank like I guess I'm wondering as a consumer like what what we want to see because I feel like my needs are simple, right? I feel like that I don't want to feel like I get screwed over. And here's the thing, too. I have to be honest, the idea of free checking and savings comes at a price. Right? There's actually in the book, The Big Short, there's actually a passage in the book where bankers got together and they said, we're going to invent this concept of free checking, because we know that it's going to cost poor people more money to have a free checking account than to have a monthly fee on a checking account. There's restrictions on how often you can use your debit card. There's all of these little nickel and diming things that have led to free checking accounts not being free.

Dyalekt :

So you're talking about reregulation, right and trying to impose some new rules on it. And the thing that I think is that banks like reregulation doesn't feel like the word because banks have become this big Akira canadia sprawling monster thing that's overtaken that inside. I think we need to like cut away and find the things that are important. That's you're saying about like simple needs, right? And have simple needs to, I want a bank to feel like a service. And or I want a bank to be upfront about its business practices.

Pamela Capalad, CFP, AFC :

Like I'm okay with either one of those, right? It's like, tell me how you make money.

Dyalekt :

Right? And like, if it's a thing where like, just Are you saying about how we have free checking and that comes at a cost? I would be okay. If we knew that having a checking account made that you had to pay $10 a month and that was the thing. And that's all that happened. Yeah, no nickels, no dimes, no bells, no,

Pamela Capalad, CFP, AFC :

no turning around and doing weird shit with my money like,

Dyalekt :

Well, I mean, that's one of the biggest things when people talk about professional business relationships with money. You guys who have worked in companies that you where you are in control of stuff that happens for the quarter. predictability is more important than a sudden surge. Right? Exactly. an unpredictable surge of money is like cool, but that makes everyone nervous because if it's not sustainable, it's not a good thing.

Pamela Capalad, CFP, AFC :

Right. Exactly. Well, and the other thing about banks is I feel like that they are not obligated to disclose their conflicts of interest. Right, they're not obligated to say hey, like I am your banker here. But on the other side of it, this investor is also my customer.

Dyalekt :

By the way, thank you everybody who's dropping in some things that they would like to see in their banks, I want to shout out a couple from New York dragons. USAA has no fees. USAA is an awesome bank that takes care of people. And even if you don't have a huge portfolio, they treat you like a valued customer like family. Why is that? Because to br with USAA, you need to be a military family. And, you know, I'm happy that we have an institution that is created and federally regulated, that takes care of our troops and the family members of our troops, especially good stuff is so difficult, but like, really, it's a model that shows it can be done. Yeah, exactly. And no one's like USAA is not profitable. They suck right? I've never heard anyone say anything bad about USAA.

Pamela Capalad, CFP, AFC :

Yeah, they don't make the most money. But why does a bank need to make the most money? I think that's the other thing. That's so frustrating, right? It's like you don't have to make the most money. You just have to make enough.

Dyalekt :

Well, and it's like what? Yeah, it's what we say all the time. What we asked you all who listen is what is enough? Find out what is enough. If you're making a business, find out what is enough and stick to that thing. Don't start nickel and dime. And just because you can because you always can. I'm from Lisa, I want black owned banks or Asian owned banks. Yes. You know, one of those things about like, we talked about with police, too, is like, there was a lot of mess. And there's a lot of problems, regulation, all these things. But one large change would simply be by having people from the community be the bankers. Yeah, totally. That doesn't fix everything. But at least like we talked about, like I walk in there and I know somebody, I can talk to them.

Pamela Capalad, CFP, AFC :

Well, and you can talk to them and they they will listen to the things that you're dealing with. You're not just a number. You're not just like a checklist of things that they say yes or no to because everyone's circumstances are nuanced, right? Especially when it comes to money, especially when it comes to finances. And to be able to walk in and feel like you're part of a community bank is such a huge like sense of relief. Because you're like, you know what things happen? And if my banker has my back then that's great, right? Um, Lisa, we did have a post yesterday on six black owned banks we love. And I think that the other really important thing about a bank not being owned, predominantly white owned, is the fact that we, especially since COVID, especially since the BLM movement has really researched in this time.

Dyalekt :

An uprising I would call it.

Pamela Capalad, CFP, AFC :

We've been trying to support more black businesses, but what we found is that it's really difficult to do that when a lot of our staples, a lot of things like toilet paper and hand sanitizer and diapers and you know, just trying to get a can opener or something like that. It's really difficult to find in black owned businesses because predominantly white owned companies have monopolized that whole arena. Yeah, there's monopolized essentials right? And banking is an essential

Dyalekt :

Killer Mike had a great show on Netflix. Yeah, it was like going through trying to go and, and patronize all these institutions that showing the difficulty with it. I appreciate what you're saying about they don't even really look me in the eyes. And I've seen that many a time when I've gone into institutions where the people not like you and they're like, Oh, I don't I don't want to look at you. I don't want to treat you like a person that actually happened to us when we were in labor with the baby. We're at Memomides hospital and none of y'all people looked us in the eyes. Memomides, y'all are jerks. So I feel you on it. One thing about it, though, that that makes me nervous. And what I've seen over the last few years is like that all skin folk ain't kinfolk. Where there are a lot of places who have decided we're gonna put our ethnicity at the forefront of our name, but we're gonna run our business in the same exploitative manner.

Pamela Capalad, CFP, AFC :

So something to watch out.

Dyalekt :

Yeah. When we're looking at these banks that are run by people like us that are run by non white people just in general, see around the community, do a little bit of vetting and see what's going on with them because there are a lot of heads in all these industries we've just been like, I It breaks my heart when I see cats go and be like, buy black what they really mean is by me, and they're still in that same hyper competitive, taking over deregulated idea of what banking should be.

Pamela Capalad, CFP, AFC :

yes, no, I love all these ideas though. Let's go to song. Yeah, I want to talk about some deal breakers and some dealmakers because that's creating our ideal bank. Let's talk about what we love about our banks and what we hate about our banks, too.

Dyalekt :

So we're gonna go we were over in Seattle, and we're gonna bring it a little bit eastward to Baton Rouge, Louisiana, for an artist who is probably from the East Coast because his name is NJ Bread. And unless that's enduro bred that he makes it probably he was bred in New Jersey, I'm just saying from the album, The Birth of Bred this song is make it better.

Song :

be better just give me the credit to Doug without I'm making this phone Sabrina woulda gave birth to the stuff 1987 or in my head these differences but that said the boss guy came in the same bed satisfied the fuck child support. They never fail when they get stressed. or Miss understanding. Was that a necessary? No, you still got my love life. Life was on cruise. No. That's impossible. We got to do better to say it even if you don't warm breeze Oh guy you're just well have been known to make it better. I'll make it you know, I'll be better just give me the credit to stuck with your choice. Always remember that day I wrote my first book? I was like 13 I was so great. Every day, Bernie sees my friends play in the shreds right? in good faith. I remember the days when my shit was rushing was when I put in Word want to track coming up and giving up no slac Drug distribution is my dedication my only choice in our make it better, I'll make it better. You know, I'll be better just give me the credit.

Pamela Capalad, CFP, AFC :

Love it. Oh, I love all this, we can make banks better. And I think that we're starting to see that now there's a lot of startups that have decided to be banks, right. There's a lot of startups that have decided like, Hey, we're going to make banking better for the consumer,

Dyalekt :

yeah, well, I think a lot of them came in, you know, maybe not necessarily making we're gonna make it better for consumer, they came on the whole startup thing of like, hey, startup for like an easy way to try something out, which means we can try new things. And when it came to banks, I think like not to diss the startups that are doing the bank thing. But just on a business level, they saw that there was opportunity where banks weren't treating customers.

Pamela Capalad, CFP, AFC :

They weren't and people were leaving, and people didn't have any other options, right.

Dyalekt :

So it's just good business to start a bank that doesn't treat people like their cattle.

Pamela Capalad, CFP, AFC :

This is a good story. Hold on.

Dyalekt :

Yeah. So when I had from Lisa also, when I had my baby, they left me in the waiting room while they were watching TV. My daughter's slid out as soon as I said that I had to catch her. There's lots of institutions that don't treat people like people even though they're really important.

Pamela Capalad, CFP, AFC :

Our baby is 11 months old. So all of that is feel so recent for me and I'm like, holy crap. Oh my god. Yeah, but let's talk about our deal breakers.

Dyalekt :

Yeah, for real.

Pamela Capalad, CFP, AFC :

Yeah, women are amazing. Yes. Women are amazing period. Yes. The shit we go through and the things we still do anyway.

Dyalekt :

Moms, non-moms all y'all Yeah, yeah. Who people do to me too much for like, Oh, it's moms but like pre moms. I never moms are still

Pamela Capalad, CFP, AFC :

We still get our periods every month y'all. So you know, and we just like live our lives. Like, that's normal. So anyway, yeah. Anyway,

Dyalekt :

That's a whole nother episode. I was like, I feel less qualified to talk about that. I'll do the questions for that.

Pamela Capalad, CFP, AFC :

Just be supportive. Um, you know which tampons to buy at the grocery store. You know?

Dyalekt :

We can't go into grocery stores. We have to stock up. Okay. Yes,

Pamela Capalad, CFP, AFC :

Anyway, let's talk about let's talk about deal breakers and deal makers. Let's do it. Let's. So the thing about banks is let's talk about the fees that banks charge right. There's a number of them monthly fees can be charged on checking and savings accounts, usually between five to $25 a month. Often there's ways to waive these fees we mentioned it earlier spending enough times on your debit card or your credit card and your debit card specifically at the bank. So they get those interchange fees. The other thing you can do is have enough money, a minimum balance requirement is what it's called in your checking or your savings account, waive the fee as well. The other thing is often a lot of banks will allow you if you have direct deposit to waive the fee. So there's all these different ways to circumvent a monthly fee.

Dyalekt :

You know, and you know, to be transparent, we've done this as a workshop with a lot of students before and I've had a varied amount of answers for like what is a good fee and what is a bad fee? I see a lot of fees that people were like, I like having low balance fees. And the people who said that they like having low balance fees. Those are the ones who are saying it helps me regulate. Yeah, myself. Yeah, totally. Which I understand. That's real.

Pamela Capalad, CFP, AFC :

Yeah, the thing about fees is they become such a, like a negative thing, right? This idea of like, Oh, I can get a bank that lets me bank for free instead of paying fees. But again, like I mentioned, what else are you paying for if you're not paying a monthly fee? And so that's something to consider too, especially if it's a thing that feels like a deal breaker doesn't necessarily need to be a deal breaker, right?

Dyalekt :

Yeah. Well, I mean, this is about you and your threshold, because for some people, it feels like a good thing. Me personally, having a minimum balance fee makes me nervous, and it makes me check back too much and it makes me stressed out.

Pamela Capalad, CFP, AFC :

So that can be a deal breaker. That's fine. Gotcha. That makes sense. All right. So then we have ATM fees. And ATM fees are fees that are charged at the ATM by the bank, and you get charged at the ATM machine and by the bank themselves. So that's to encourage you to only pull money out of a bank ATM. Now there are plenty of banks that do not charge ATM fees. One of them was already mentioned by New York dragons the you USAA actually reimburse your ATM fees up to a certain amount which is amazing which we love which we love. Usually a bank like chase or Citibank, or you know, whatever big bank will charge you, the ATM machine will charge you and the bank will also charge you so it could cost you six or $7 to pull out $20 right.

Dyalekt :

I was so old when I found out that actually happened. I remember just being like, at the end of the month being like I didn't take out money that Where's my money? Like what?

Pamela Capalad, CFP, AFC :

Yeah. Yeah, there are plenty plenty, plenty of banks now who have decided to not charge ATM fees. So and you also reimburse ATM fees New York dragons mentioned earlier USAA bank and one of the things that's great about USAA a bank is that they reimburse your ATM fees that get charged by an ATM machine. Schwab is another bank that does that Ally Bank is another bank that does that I believe simple bank also does the same thing. Simple bank is an online only bank. A lot of these online only banks that don't have branches are actually able to charge less fees because they Don't have the overhead of a branch.

Dyalekt :

Well, and a lot of these online banks, you know, we're talking about building a better bank, they kind of are creating these new models themselves. And also they found that banks rather than being a fulcrum that has offshoots, that the bank can be the offshoot of what because like Schwab, Schwab is an investment firm, they don't really care about like, yeah, your checking or savings account,

Pamela Capalad, CFP, AFC :

they basically set up this really nice investor checking account that doesn't charge ATM fees that also doesn't charge foreign transaction fees. So you can pull money from any ATM in the world and they'll reimburse your ATM fees worldwide. Because Charles Schwab primarily makes their money as a retail investment firm.

Dyalekt :

Yeah, the the bank stuff is actually the loss leader. Yeah, that's something I want you guys to look at when you're thinking about how a bank makes money is not Is it like Well, I mean, yeah, have your moral stuff of like, you know, I don't like it. I don't appreciate how that that makes money, but also think about it in terms of is it going to benefit you?

Pamela Capalad, CFP, AFC :

Yeah, yes, exactly. overdraft fees, so Most banks charge overdraft fees. This is the worst, biggest racket scam, whatever you want to call it, because they call it overdraft protection. It's an overdraft protection fee. Anytime your bank goes below zero dollars, you get charged between $25 to $30. For every transaction that you make when the account is below zero dollars, that is insane. I have seen people who have been charged two or $300 in one day because they didn't know that their bank account was below zero, because and this happened to you. This literally happened to you. He deposited a check, and then he spent money that day. And what the bank decided to do was instead of depositing the check first they ran the other transactions first and then ran the check deposit amount.

Dyalekt :

The full story is on previous episodes you've heard

Pamela Capalad, CFP, AFC :

Yeah, exactly. But there are places that do not charge overdraft fees. If you are with a bank that charges overdraft protection fees. You can deny the overdraft protection you can say nope do Do not do overdraft protection with me if I don't have any money in my account let the card get declined This

Dyalekt :

This is generally an opt out kind of thing so when you're rocking with the bank if they don't say anything about overdraft protection bring it up.

Pamela Capalad, CFP, AFC :

Yes, exactly. So let the card get declined because overdraft protection is now a default thank you.

Dyalekt :

I mean and you know again to not you know put your feelings in your mouth if you're like I can never have my card declined I'd rather take the fee that's fine yeah, I should know that

Pamela Capalad, CFP, AFC :

that's fine. Also you may want to consider using a bank like simple bank we mentioned simple bank earlier they charge no fees at all including overdraft fee so if your account balance goes below zero dollars, they will not charge you an overdraft fee at all.

Dyalekt :

overdraft protection I just Yeah, the language of it. It just sounds so mafia-sk

Pamela Capalad, CFP, AFC :

It's a protection racket. It really is it's true. And then the big deal breaker for a lot of people this is the reason why they're willing to work with shitty banks on the finance side is because of technology. So most of us do our banking mobile Most of us don't go into a branch, most of us deposit checks on our phone. Most of us transfer money through Zell or the bank transfer or connect our bank accounts to Venmo or PayPal or whatever it is. and technology has become a deal breaker for a lot of people. This is one of the downsides of credit unions in particular, is their technology has not caught up with what we need the technology to be for a bank. And I think that's something that is one of the trickiest things to navigate. I've had clients leave banks, because their technology wasn't good. And because their technology was difficult to use, and they weren't able to as they were traveling deposit checks. And, you know, check what their bank account balances were easily and transfer money back and forth easily to different accounts.

Dyalekt :

I mean, I've had older relatives, I've had to try to talk them out of leaving good banks or good situations because they didn't have a great mobile or great internet presence and it was more difficult for them to do it.

Pamela Capalad, CFP, AFC :

Yeah. Exactly. So when it comes to what your deal makers and deal breakers are for existing banks, now there is a no ideal bank out there, unfortunately. And I think until some big regulation happens, banks are going to continue to profit off of us in ways that we don't even understand and don't even fully know. And what we can do now, in the meantime, is don't let banks walk all over us. Keep in mind that you are still a customer and banks are still a business and you can always take your business elsewhere. The way that banks try and keep you in is because your whole financial life is there, right? Your direct deposit is there, your all of your you know, bills and utilities are getting paid out of there. It's a pain in the ass to change banks. But really and truly, if your bank has been very abusive to you, then just do it. Just take the time write down a list and figure out what you need to to undo to be able to switch bank

Dyalekt :

For all our entrepreneurs out there. We talked a little bit about how startups are doing things a little bit differently because they're not worried about how the banks are making money. They're like we can make gobs of money another way, but these are still I feel like These businesses are still thinking with the same mentality that old school banks had to have, like, I'm gonna make as much money possible, doing vaguely a service but really profiting me. For those folks out there who are entrepreneurs, but they want to create a business that's a service that helps people what's the first thing they should think about? If they're going to start their own bank?

Unknown Speaker :

Oh, what's the what's the

Dyalekt :

essence to you? Just to like, you know, don't say like your Yeah, ya know, and everything, but just to you, what's the essence they should get?

Pamela Capalad, CFP, AFC :

I just feel like I want to know that a bank is not going to screw me over. Like, I don't care how you make your money, as long as I understand how you make your money, right. As long as I understand that you are not making your money in ways that I feel morally compromised by, I want to understand what fees I'm going to get charged. I don't want any surprises. A bank should not surprise you with their fees. They should not surprise you with how they're making money off. Every business needs to make money. We understand that we understand that fundamentally, we understand the banks or businesses need to make money. But I think that banks have become so opaque and so Complex by design that none of us really understand what we're getting involved in when we try and open a bank account. And that's

Dyalekt :

what I want. You're saying you want banks to not only be experts about money, but to share their expertise and show and be transparent with you. Yeah, about what you're doing. Hire black with their radical transparency stuff that they got going on. I really love that. That's the idea that, you know, you can rock with the bank, they can make all the money however they want. But as long as they tell me about what they're doing, it's going to be okay. Yeah, I'm with that. I think that's a really important thing. What about you? Oh, and with that, what is the thing that I want from a bank? Yeah, because I love the transparency thing of it. I love the like, not gonna screw you over thing of it. But I think the most important thing is I want the bank to be the financial center that's part of a community. The thing even more so than being transparent is I want them to survey. I want them to ask questions. I want them to come into a place and say we're moving into your community. We want to be the Bank of this place. I even like in the name like even if you have branches across the country. I want every name of your bank to have the town that it's in.

Pamela Capalad, CFP, AFC :

No, I love it. No, I love that. And that made me think of another thing is if we say that small businesses are the lifeblood of this country, prove it, prove it, prove it, banks make it easier for small businesses to get along, take a risk on us in the same way that you're willing to take a risk and more dangerous ways and in more complex ways, take a risk on small businesses, because we have proven that we are resilient through so many things. And we just need your support to be able to continue to do that.

Dyalekt :

Because businesses exist to solve problems, right. And banks exist to be an intermediary between people and people, people in businesses, businesses and businesses. Businesses are in there a lot of times so if you want to take care of us take care of them, they'll take care of you and the cycle continues.

Pamela Capalad, CFP, AFC :

I love it. Oh, take us out.

Dyalekt :

To get out of here we're going to go to Dumfries, Virginia for an artist's name because and they're going to tell us about how to make better business. Thanks for listening in. We're gonna continue doing what we're doing. If you've got some ideas or some things you tried to push on through, make sure you let us know about it. We'll keep on sharing keep on doing this a bunch of bunch of the podcasts part of the race and wealth Network. Thanks for listening, y'all. Peace.

Pamela Capalad, CFP, AFC :

Thanks y'all.

Song :

Sometimes our problems deep sometimes our problems so this one's for the big folk worldwide. And so give us five. I hope you fill that space with a misfit book. So we'll begin the video. in this situation that you're facing here that open Heaven's Gate since it's not too late to set them straight, we came back into flesh. We'll be facing all that in a state of perpetual backlash. Speak out and you shouldn't catch a backlash because we're busy the first solution with the fast track so we blast back with that loop in a trash bag. That stick keeping my people back like we have madelinetosh that brings us back That unity, that community, Chevron, all things in common like it used to be racial injustice, bondage, prejudice searching for identity, pride, vanity crisis conspiracy agenda decisively clear to me pain and depression and to respect her isolation privilege types inequality pandemic if you follow me yes yeah I'll admit I've embraced my discouragement for fall back on the holy bird. Yes, sir. I'm searching for encouragement stifled and the team and Eddie will still flourish and hunger for love of painting I'm in need of some nourishment. The food is the moves that we make. When the tool says we break all the rules and accuse us to hate. We never use over steak. It's not the truth that they make. Never did they leave you bruise. But what is the fate? the evidence of things I've seen or felt in my various things. So it's more than a dream spirit wide awake to the king, I will claim good news I will bring. I was speaking with my father the other day, Ron laid the story of how he had to find his way through the military in this country so when not declare it he was in the first desegregated barracks, Fort Knox. They said there was a riot building burned down, but it was one where black soldiers were to be handled. So how would you be yet if the flag you fought to protect never had your back didn't see you with human off assuming you would feel the way so with this in mind We raise voices a lot today, marching into to borrow, redeeming or top borrowed instead of fetishizing or death and song. Just yesterday was marked with pain