Financial System Is Still Shaky

A few months ago, the stock market was cratering and our entire financial system was on the brink of collapse. The federal government pumped billions of dollars into some of the largest financial institutions in an effort to keep them from failing and taking many others with them.

Since then, the market has rebounded, and the bailed-out entities are doing better and once again wanting to hand out ridiculously large bonuses (to the same people who nearly sunk them in the first place). So our financial industry has been fixed, right? Well.....NO!

The giant banks who received billions of our tax dollars may be doing OK, but there are hundreds of other banks that are not doing well at all. As of yesterday, 106 banks have folded this year and been taken over by the FDIC. That's the largest number of bank failures since 1992, when 120 banks failed after the savings and loan crises ( and we still have two months to go before the end of the year).

And that's not the worst of it. The federal government has identified at least 416 more banks that are in serious risk of failure. The feds have been trying to slow down the takeovers of failed banks, to keep the public from panicking. The hope is that a rebounding economy could save some of these banks.

But that's a futile hope at this time. With tons of jobs still being lost every month, our economy is a long way from rebounding. With the pundits predicting the job market won't start producing more jobs than it loses for at least another year, we can expect to see hundreds more banks fail.

Rich folks and giant banks may think the recession is over, but workers, small businesses and small banks know they are still in the middle of an economic disaster. And it could be years before things get significantly better (just look at how long the Great Depression dragged on).

(NOTE - Cartoon is by Jeff Parker in Florida Today.)