Jack & Jill Politics

Above find a video from DailyKos on the state of the economy. Somewhat lost among all the excitement and pomp of yesterday was the fact that bank stocks dropped yesterday in the worst Inauguration Day drop in history. Bank stocks like Citigroup and Bank of America are now worth less per share than say, what you’d pay for a tall latte at Starbucks. Bad news: it’s hard to have a financial system without banks. Obama was all smiles but you know this had to be weighing on his mind since the worst part of the drop happened after his speech in the afternoon. Banks were struggling worldwide yesterday. To me, however, I had to wonder how much of the drop was due to international factors and how much might have also been triggered by fear of a black president.

Why do I say that? I don’t know his name but one anchor on CNBC yesterday actually pointed to what he called “class warfare” in Obama’s speech. Everyone knows that Wall Streeters tend to lean conservative. I’d say there’s been plenty of class warfare when you talk about how ordinary Americans have been treated by the Bush administration (um, subprime mortgages? the shaft that credit card holders have received? etc). Obviously we have to keep banks from collapsing as they did during the Great Depression. Yet, pouring money down banks without addressing the root cause of their troubles only perpetuates the distress. People can’t pay their mortgages or their credit card bills. Cuz Americans be broke. We need to fix the system to help average Americans with housing and jobs — we need to spend billions not just on banks but on homeowners.

Obama has put the economy front and center on his agenda and on his coolio new website www.WhiteHouse.gov. Here’s some info on what Obama is proposing from his new site.

….the President has put forth an American Recovery and Reinvestment Plan that will jumpstart job creation and long-term growth by:

• Doubling the production of alternative energy in the next three years.
• Modernizing more than 75% of federal buildings and improve the energy efficiency of two million American homes, saving consumers and taxpayers billions on our energy bills.
• Making the immediate investments necessary to ensure that within five years, all of America’s medical records are computerized.
• Equipping tens of thousands of schools, community colleges, and public universities with 21st century classrooms, labs, and libraries.
• Expanding broadband across America, so that a small business in a rural town can connect and compete with their counterparts anywhere in the world.
• Investing in the science, research, and technology that will lead to new medical breakthroughs, new discoveries, and entire new industries.

One thing that can’t be denied is the abysmal failure of Bushonomics: When George W. Bush took office the Dow was at 10,578.20. By the time he left office, it had fallen to 7,949.09, a 25% drop. Oof. Obama has promised to sign a credit cardholders’ bill of rights. Banks can see this as a strike against them, but the fact is that fair policies will benefit them as well as their customers in the long run.

Higher interest rates on a current balance will be permitted only under specific conditions such as the expiration of a promotional rate, late payment or a variable rate. Interest rates on new transactions can be increased only after 45 days’ advance notice.

There will be no more universal default, nor raising interest rates based on a customer’s payment history with utility companies or other credit issuers not affiliated with the bank issuing the credit card.

Payments will be due at least 21 days after the bill is mailed or delivered. Credit card issuers will no longer be able to set early morning deadlines for payments.

When a different interest rate is applied to various balances, payments will be applied first to the balance with the higher rate or divided proportionally.

Customers exceeding their credit limit will no longer be hit with a fee if a hold has been placed on their account. This routinely happens to customers who reserve a hotel or rental car when merchants place a hold on the account for the entire amount to be billed several weeks or months in the future.

Finance charges on a balance due will be computed on charges in the current cycle rather than going back to the previous billing cycle. Double-cycle billing hits customers who pay their balance in full one month, but not the next.

Terms will be disclosed in plain English.