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Tag: Banking industry

  • Bank of America to Cut 16,000 Jobs by Year’s End

    Bank of America to Cut 16,000 Jobs by Year’s End

    Bank of America will be speeding up its cost-cutting measures and will lay off 16,000 employees by the end of the year.

    The Wall Street Journal has obtained a “document given to top management” of the bank and is reporting that the layoffs are part of cost-cutting measures that will make the company “a leaner and more focused enterprise.

    The document states that the plan is to “become a major deal maker around the world” by taking less risk, making more money from existing customers, and using an investment operation from Merrill Lynch, which Bank of America acquired during the financial crisis in 2008. This all translates into fewer local branches and a shrunken mortgage operation.

    The Wall Street Journal points out that these cuts will drop Bank of America from its position as the U.S. bank with the most employees. After the layoffs, the bank will have an estimated 260,000 employees – less than J.P. Morgan Chase, Citigroup, or Wells Fargo, the report states.

    Bank of America has faced the same financial difficulties that other banks have since the sub-prime mortgage loan crisis began. The company has implemented numerous cost-cutting and revenue-generating changes, including considering charging a fee for basic checking accounts. This has made the bank unpopular with banking customers, and it was the runner-up in The Consumerist’s “Worst Company in America” competition this year.

  • America: Banking Bailout Bad, Auto Industry Good!

    A new Harris Poll released today has found that America’s perceptions on the automotive industry bailout of 2009, and the bank and insurance bailout of 2008, have changed in the over three years since the events. Surprisingly, a majority of tax payers now support the bailout of the auto industry, namely GM and Chrysler.

    The insurance and banking industries did not fair as well unfortunately. A majority of tax payers today see the bailout of the financial sector as a mistake. A number of factors, many political, seem to be shaping our perceptions about the events, and could have an impact on upcoming presidential election.

    Looking back at 2009, 69% opposed the bailout of the automotive industry. 65% opposed the bank bailouts and an overwhelming majority, 77% was opposed to the insurance bailout. People were not on board for spending tax dollars to help these industries get out of trouble.

    Today, pluralities still believe the financial bailout of the banking industry hurt our economy (by 48% to 23%). 42% to 15% believe the insurance bailout also hurt the economy, but the success in the automotive industry has changes people’s minds and they now feel the GM and Chrysler bailout helped our economy (45% to 29%).

    So what implications will this have for voters? I am not really sure. It depends if people blame Obama for the bailouts or praise him. Some of the actions took place under the Bush administration, but will voters remember that? Follow this link to see these approval ratings in graph format and to view breakdowns by political party.