50 Million Dollars a Day

Except for two business days when money was lost in the second quarter, the U.S. bank Goldman Sachs earned $50 million or more per day between April and June. During this same period, there were 46 days that had gains of over $100 million a day.

In total, the bank was $3.4 billion in the black for the quarter.

At the end of 2008, Goldman was saved with $10 billion in cash contributions from taxpaying Americans. The amount was sent by the Treasury Department, at that time managed by Henry Paulson, ex-president of Goldman Sachs.

Paulson also loaned money to other banks. In total, deposits of $350 billion. Several, like Goldman, have paid the loan, and life goes on.

The purpose of the emergency contributions: keep the banks afloat until they return to profitability and can finance mortgage lenders.

The first part worked.

Most banks returned to profitability in the second quarter. The rebound is evident in their share values on the New York Stock Exchange.

The second purpose, the financing of mortgage lenders, has not been so successful.

In June, the volume of credit offered by banks to households in the U.S. dropped for the ninth time in 11 months. About $10.3 billion less was borrowed. The drop is five percent over the last 12 months. This is bad, because 70 percent of the GDP depends on U.S. consumption.

As for the borrowers, in addition to direct injections in banks, in March the government put $35 billion in the system to finance equity for families in debt.

Today, 2.7 million mortgages have gone unpaid for at least two months. Less than 10 percent of these loans – 235 million – have reached agreements with the banks. The rest are running the risk of losing their homes; there have been 1.5 million evictions in the first half of the year.

At the height of the crisis, the Obama administration launched an ambitious plan to tighten regulation of the financial system and give more protection to consumers, including cuts of executive bonuses and restrictions on those who make large amounts of money from taking high risks.

Strengthened and profitable, the banking industry now wants to maintain the status quo.

It is funding hundreds of key political posts in Congress.

A recent study shows that the approval of Obama fell from 57 percent in early July to 50 percent in August.

The effect is not as strong with African Americans.

Only two percent of whites are “very satisfied” with the government, compared to 13 percent of blacks. Among whites, 47 percent say the economy is bad, but only 25 percent of African Americans think so.

Unemployment is almost double for African Americans: 14.5 percent compared with 8.6 percent for whites, with an average of 9.4 percent of all Americans.