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Practically Speaking

Kyle and her husband moved to Brookfield in 1986. She became active in local politics and started blogging in 2004. Her focus is primarily on local issues but often includes state and national topics, too. Kyle looks at things from the taxpayers' perspective in a creative, yet down to earth way, addressing them from a practical point of view.

Not every bank is broke, Wells Fargo to buy Wachovia

Legislation, THE ECONOMY

Last week, I was at US Bank; a CD had matured. I asked the banker, does US Bank have money to lend? Could I get a loan if I needed one? He said, Yes, it was no problem. (I have a good credit score.) 

A local car dealer last week said they had money for financing too.

So we see, not every bank is short on available cash. And now this: Wells Fargo acquiring Wachovia for $15.1 billion! (My emphasis)

 In an abrupt change, Wachovia said Friday it agreed to be acquired by San Francisco-based Wells Fargo & Co. in a $15.1 billion all-stock deal that trumps Citigroup's plan to acquire Wachovia's banking operations and avoids government assistance.

The Citigroup deal would have been done with the help of the Federal Deposit Insurance Corp., but the Wells Fargo deal for Wachovia will be done without it. Shares of Wachovia and Wells rose in morning trading, while Citigroup shares fell.

Today, all eyes are on the House, seeing if the bailout bill passes there. I am hoping it doesn't since it contains too much pork and not enough reform. Loads of Pork, Little Accountability in Senate Bailout Bill: Will the House Balk?

 

The House rejected the original bill on Monday but the revised bill contains a lot of "sweeteners" designed to garner enough votes, including $100 billion in tax relief, a widening of the FDIC insurance cap to $250,000 and aid to rural schools.

But the Senate bill is also laden with pork, including:

  • $223M for Alaskan fisherman
  • $192M for rum producers in Puerto Rico and the Virgin Islands
  • $128M for auto racing
  • $33M for companies operating in American Samoa
  • $10M for film & TV production
  • $6M for producers of wooden arrows

In the meantime, the private market is working, buying up bargains and expanding their market share. 

UPDATE: New development. Wells and Citi are fighting over who gets to buy Wachovia! Wells Fargo, Citigroup in tug of war over Wachovia 

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