You know, you were damned if you did, or damned if you didn’t. But you can’t be damned forever. Well, at least not in this article. When I look at all the people protesting, the 99%, I think about how some said, “We shouldn’t have bailed out Wall Street. We should have let the defaults happen or let the depression occur. It would have been a natural correction.” I think about it because so many people who did what they were suppose to do are suffering. And, when you are in pain and someone says, “You know, it could be worse.” You think, “What in the Hell are you talking about???!!” But, it could be worse. When the depression hit and banks failed, people just lost their money. For example, one day you had 3,000 in your checking and savings account. The next day, you had nothing, the bank doors were locked. And that was that. Also, some banks that had not failed, but were failing, put limitations on how much you could withdraw. See, we are used to limits like you are only able to withdraw $500 a day from the ATM or you can only withdraw a certain amount daily or weekly from your bank, after that you pay a penalty. But during the depression, you may be told that you could only take out 1000 a week. That is it, no penalty, no checks, debit card and no coming back until the following week. No access to your own money until the designated time. If you have an emergency or a bill, that is too bad. This was why people in our grandparents and great-grandparents generation put money under the bed, in a sock or in the closet. My grandmother had money in the closet. You know it is funny, we work, we deposit our hard earned money in banks, we bail them out when they are in trouble with our money, yet they still act as though it is their money. It’s not.
The latest bank in the news is Bank of America. The bank president justified the $5 debit card fee that will start in January. People complain, but they really don’t do much. We seem to have become complacent. One customer has decided to start a petition. I think that is a great idea, but I think that the smart idea is to leave. I think if enough customers changed banks, Bank of America would get the message. This blog is supposed to be about surviving during this economy, and sharing how to save money during this economy. So, I will say, a frugal diva cannot afford banks like Bank of America or Citibank. $5 a month is $60 a year. In this economy $60 can mean more food on the table, gas in your car, the ability to pay off or catch up on a small bill, more money in your pocket, or more money in a bank or credit union with reasonable rates and fees. Banks have a right to make a profit, but Frugal Divas have the right to save money.
An AARP article in January, discussed internet banks (http://www.aarp.org/money/budgeting-saving/info-01-2011/looking_for_free_checking.html ), and banks that still had free checking. Yes, I said AARP. Most AARP members are on a budget, so they always have to look at ways of saving money. What can I say, this Frugal Diva is creative.
Below is one of many stories of how people worked together during the Great Depression. I have listed the site as well. Many have said that Steve Jobs changed the world, and he did. But, he did not do it alone. Everyday people can work to make a change every day.
Activism
Penny Auctions
As the pace of foreclosure auctions increased between 1930 and 1932, more and more farmers became desperate. Activists demanded that state legislators halt foreclosure sales. Angry farmers marched on the capitol buildings in several states, including Nebraska. Some farmers in Madison County, Nebraska, took matters into their own hands. In 1931, about 150 farmers showed up at a foreclosure auction at the Von Bonn family farm. The bank was selling the land and equipment because the family couldn’t repay a loan. The bank expected to make hundreds, if not thousands of dollars.
As those who were there remember it, the auctioneer began with a piece of equipment. The first bid was 5-cents. When someone else tried to raise that bid, he was requested not to do so – forcibly. Item after item got only one or two bids. All were ridiculously low. The proceeds for that first "Penny Auction" were $5.35, which the bank was supposed to accept to pay off the loan.
The idea caught on. Harvey Pickrel remembers going to a Penny Auction where "some of the farmers wouldn't bid on anything at all – because they were trying to help the man that was being sold out." At auctions across the Midwest, farmers showed up as a group and physically prevented any real bidders from placing bids. But the banks figured out ways to get around these illegal Penny Auctions.
Farm groups and activists turned their attention to the political arena demanding a stop to foreclosure sales. Eventually, several Midwestern states, including Nebraska, enacted moratoriums on farm foreclosures. Generally the moratoriums lasted a year. The theory was that the Depression couldn't last that much longer, and then farmers would have the income to make their payments. But the Depression continued, the moratoriums ran out and farmers continued to lose their farms.
Written by Bill Ganzel of the Ganzel Group. First written and published in 2003.
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