According to the Washington Post, a new study shows that hundreds of banks in the United States would be in danger of failing if they were hit by runs similar to the one that recently brought down Silicon Valley Bank. Questions: Source: Werner, E. (2023). Hundreds of banks would be vulnerable in SVB-style runs, researchers… Read more »
Posts Tagged: banks
Attention Zelle Users
According to the New York Times, when customers say their money was stolen on Zelle, banks often refuse to pay. Questions: What is Zelle? What Federal Rule protects consumers in fraudulent electronic transfers of money? How much money was sent through Zelle and Venmo last year? What is Sim Swapping? What progress has been made… Read more »
COVID-19 Leads to Borrowing Binge
According to the New York Times, during the pandemic,along with the sharpest economic downturn in history, the solution by most companies has been to take on more debt. Questions: Why does this borrowing binge turn conventional wisdom on its head? Does the article make it sound like there will be many defaults to the Fed… Read more »
It’s all in the way you interpret The Community Reinvestment Act
According to BusinessInsider.com, the Trump Administration is pushing for funds meant for low-income neighborhoods to be funneled to the NFL for a new stadium. Questions: Who proposed the rule change and to whom? When was the law or rule passed? What are the pros and cons for putting stadiums in opportunity zones? Do you agree… Read more »
Trouble in the Repo Market
According to the Bank for International Settlements, the Financial Times reports that turmoil in the repo market was fueled by hedge funds need to borrow cash in order to drive returns on trades. Questions: What is the Repo market? Why is the pullback by bank lending a bad sign? Explain the increasingly popular hedge fund… Read more »
Credit Card Chips
Did you ever wonder why so many retailers have chip-readable machines for credit cards, but tell you to swipe your card anyway? This article explains this frustrating issue for retailers. Questions: 1. Merchants have spent incredible amounts of money to get new chip-reading machines, so what is the reason for not using them? 2. Since… Read more »
Lock Down that Debit Card
Have you ever lost or misplaced your debit card? Now some banks are offering a simple app for your cellphone that will allow you to protect bank accounts quickly while you figures out whether you lost or misplaced your card. Questions: 1. How does Bank of America’s version of the debit card lock work? 2…. Read more »
Security Chips and Bearing the Cost of Fraud
New payment cards, issued over the last year, come with a small square security chip that can help make in-person transactions more secure. However, retailers complain that they have spent billions of dollars upgrading their payment terminals to accommodate a system that cuts down on the fraud shouldered by banks, but not merchants. Questions: 1…. Read more »
To PIN or not to PIN?
Some big U.S. retailers are stepping up efforts to use personal identification numbers, or PINs, with new credit cards embedded with computer chips in a bid to prevent counterfeit card fraud. Questions: 1. Why is this being resisted by banks? 2. Which retailers are leading the movement? 3. Discuss the costs and benefits of the… Read more »
The Clock is Ticking!
A new legal quirk could bring a surreal ending to foreclosure casess around the country; the debtors may get to keep their homes without ever having to pay another dime. Questions: 1. Why might tens of thousands of homeowners who have missed more than five years of mortgage payments get to keep their homes without… Read more »