Posted on Tue, May. 09, 2006
No reason to reject Wal-Mart proposal
Should federal regulators allow retailing giant Wal-Mart to dip a toe into the banking industry? Short answer: Yes.
The Federal Deposit Insurance Corp. has been conducting public hearings on the issue, one of them recently in Overland Park.
The commercial banking industry strongly opposes such a move by Wal-Mart. That comes as no surprise. The prospect of Wal-Mart entering the business, even in the limited way that the company proposes, raises the prospect of tougher competition.
But competition is good for consumers, especially the low-income consumers who often go to Wal-Mart.
Wal-Mart�s application is not for a typical commercial bank, but for something called an industrial loan corporation. It would not make loans to consumers, offer checking accounts or take deposits from consumers. It would accept deposits from brokers, however, and would offer certificates of deposit to certain nonprofit groups. Owning such a corporation allows the parent company to offer credit cards.
Wal-Mart says it could cut fees on the credit-card transactions it pays to other banks by up to 50 percent. The savings could be passed on to its credit-card customers.
The banking industry sees this as the camel�s nose under its tent and is raising concerns about the risks. The fear is that if Wal-Mart�s financial services eventually expand into regular commercial banking, it could pressure its banking affiliate for sweetheart loans, or � in a financial crisis � drain the bank of capital.
Yet laws already exist against such practices. And regardless of whether a bank is owned by a big company or an individual, bankers regularly face pressure from influential customers for inappropriate favors.
The Independent Community Bankers Association says Wal-Mart�s entry into banking �would constitute a dangerous over-concentration of economic power that would skew market forces.�
More likely, the bankers are concerned about increased competition. Wal-Mart already offers an array of financial services, including paycheck cashing, wire transfers, express bill payment and money orders.
More than five dozen large corporations already have financial operations similar to what Wal-Mart seeks. They include General Electric and Wal-Mart�s direct competitor, Target. Wal-Mart should have the same privilege.
You are so correct...I CHOOSE not to work for WMT.
I love the freedom to choose.
I love the freedom to determine my own destiny.
More than 150 years ago one of my great great great grandfathers got tired of toiling in the peat of ireland and got tired of fighting the potato blight and he got on a boat and came to America.
About 50 years ago my grandfather was a school janitor shoveling coal into a boiler, and he was as happy as a clam. He never owned a car, he walked to work, he built his own house with a high school friend.
Choose to change your life for the better.
It empowers you.
My, aren't you the smug little ignorant lying little pissant.
My thanks for the comp.At that rate I am along way above you then.
Wouldn;t you be surprised to know that I, yes ME, worked for Wal Mart.
No not really,judging from your posts a person could come just about any concluion.
Do you post on their message board as well?
No I dont, this one is more fun with all the pumpers here,which wouldnt think of getting job with wmt so they could see first hand what it is like to work for a out fit like them.
Are they breaking laws in that regard?
Are their wages below minimum wage?
Sounds like minimum wage would about your caliber of pay.
Are they withholding mandated benefits?
Does every thing have to be mandated to treat your employees decent,evidently in your case that is the case along with Lee Scott.
What actually do they need to clean up?
Evidently you dont read the news much or you wouldnt need to ask this question.How about their wage scale & Ins. instead of goverment welfare along with all the other law suits they have against them.Of course you will have answer for this as wmt can do no wrong as far as some of you on this board.
Isn't it odd that people seem to be resentful when a company becomes global and highly successful?
resntful,no just clean up thier act and there will be no problem bud.You just cant see the fire because of the smoke in you eyes or you dont want to see.