Those still wallowing in unemployment, debt, and underwater mortgages can take some solace in the fact that the very institutions that thrust these problems onto the public are recording booming profits even as investor confidence remains low.
Long-time New Yorker staff writer John Cassidy published an excellent piece yesterday on why this is complicated news:
Five years after being bailed out by the federal government, the U.S. banking system hasn’t merely recovered from the financial crisis that brought it to the brink of collapse. It is generating record profits—the sorts of figures usually associated with oil giants like ExxonMobil and Royal Dutch Shell. During the past twelve months, for example, JPMorgan, the country’s biggest bank, has earned $24.4 billion in net income.
Legislative efforts to curb the more radical lending and investing practices fizzled and died years ago, even when the crisis was still fresh in the minds of the American psyche. It is safe to say that, for now, no reform is coming down the pipes. Let us hope we are willing to learn from our mistakes after the next crash.
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