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🤯 Ohhhh. So the whole modern concept of “banking”—borrowing money from people at low rates while promising them safe storage of their money, and then lending the money at higher rates—might… not last? https://t.co/Ltaxof94Nb
How the cheating is built into the banking core, by Matt Levine, in his latest newsletter. The bank depositor is not a customer but a user of the bank. The real customer is one who takes loans. Thus, from the banking business point of view, it is okay for banks to violate… https://t.co/jS69B4Ezdd
The basic core of how banking works is that a lot of people don’t pay attention to the interest rate on their bank accounts, so banks can pay them below-market rates. https://t.co/V69uJq6CBs
Recent discussions surrounding Capital One have intensified following allegations that the bank cheated customers out of $2 billion in interest payments. A report by Better Markets cites this figure, prompting calls for regulators to block the proposed merger between Capital One and Discover Financial. Senator Elizabeth Warren has also voiced concerns, stating that allowing Capital One to expand through the acquisition of Discover would expose millions more Americans to potential abuses. The New York Attorney General may face legal challenges in attempting to block the merger if federal officials approve it. The Federal Trade Commission (FTC) has initiated a lawsuit against Capital One, reflecting broader concerns about the bank's practices and the implications for consumer protection.