Rick S.

Wall Street Breakfast: Must-Know News

I have accounts in one of the banks closed over the weekend, Affinity Bank in Ventura California. Nothing fancy about their leverage or loans. Simply a lot of mom and pop commercial development loans that went sour because of the overall economy. It happens when development comes to a screeching halt as it did last year, developers go bankrupt, and the banks that loaned them money find themselves with an asset that has essentially zeroed out. It's a stepped process that takes time, but it eventually hits a bank's bottom line of reserves.

Ron Paul, Barney Frank, Wall Street crooks, Glass and Steagal have a lot to do with a lot of things, I'm sure. But they had little to do with the banks that closed last weekend.