B of A will you invest now?

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Feb 16, 2007 3:42 pm

http://blogs.usatoday.com/ondeadline/2007/02/bankof_america .html

Feb 16, 2007 4:01 pm

Ooops hit the enter key to fast.  


Since B of A is going to give credit cards to illegal immigrants will this affect your decision to offer their stock or bonds as investments?


Besides the fact that they plan to skip all of the money laundering homeland security B.S. that we have to put up with,   don't you think this is going to adversely hit the bottom line.  Why should/would a person who is in this country illegally make good on credit card loans. What kind of incentive do they have to pay anything back.  Ever! *** I don't care how high of an interest rate you charge, if you can't collect, it is a moot point. 


I was going to offer the latest B of A internotes until this came out.  In fact I predict a swarm of people pulling their money and investments from the bank.


*** One of my clients who owns several very large ranches and who employs quite a few immigrants said they do everything they can to determine if they are legal or not, but suspects many aren't.  Because they may not have driver's licenses or the ones they have are most likely fake, the guys buy beater cars for about $500.00, don't carry any insurance because they can't and if they get in a wreck or the car needs to be repaired they just junk it along the side of some back road.  Rinse and repeat.   The cops know this, the insurance companies know this...everyone knows it.


The rules are not applied to the illegal immigrants, yet we who do play by the rules have to pay through the nose for car insurance, house insurance, quarterly income tax withholding and DON'T even get me started on medical insurance.  The Doctors that I do business with call the Calif Medi-cal card the "Medi-cal Gold Card", meaning that every hang nail ,diaper rash or minor sniffles gets paid for by the State because they come to the hospital emergency room.  No questions asked, just give the Calif Gold Card and ta dah 100% paid for.

Feb 16, 2007 4:36 pm

I wonder if Fitch is going to renig on their decision to upgrade B of A's debt rating? 


Seems like a stupid business move.  People are already pissed about the immigration issues in this country and the lack of concern by the President.  Now they can get credit cards and home loans?  To establish their credit?  Give me a break.  You can't tell me the people at B of A don't know that they are going to be giving credit to illegals.  How do they plan on tracking down these people when they rack up $10K in credit card debt and then move to a different house?  Guess who pays that bill. 


BAC is the my largest stock holding.  Near it's 52 week high.  Sounds like a great time to take some profits and reduce exposure.  Can anyone tell me why I shouldn't do that? 

Feb 16, 2007 4:45 pm

It may piss me off, but it sure seems like a great business decision.  They're not stupid about this stuff.  The people have  to have a deposit it at the bank and pay high interest.   The ones who are getting screwed in the deal are the illegals.

Feb 16, 2007 4:46 pm

Hasn't the great Jones equity marketing department come up with an analogy to help you understand how banks make money.  I would imagine that Fes should be on your branch TV any time now explaining that illegal aliens have nipples too and BAC has figured out how to milk them.

Feb 16, 2007 5:05 pm

Sounds like a great time to take some profits and reduce exposure.  Can anyone tell me why I shouldn't do that? 



My sentiments exactly.  In fact I have had clients call me requesting to sell.  I am in a red red red county in a blue state.  85% registered republicans and the rest are probably militant libertarians.

Feb 16, 2007 6:32 pm
exdrone:

Hasn't the great Jones equity marketing department come up with an analogy to help you understand how banks make money.  I would imagine that Fes should be on your branch TV any time now explaining that illegal aliens have nipples too and BAC has figured out how to milk them.



No, we understand how banks make money and this one doesn't really make sense.  Yes, they charge high interest rates and there is a fee upfront.  Let's play the what if game.


What if you are BOA and you have Jose (name changed to protect the innocent) the illegal alien at the desk in front of you.  No SS#, fake drivers license, temporary address.  He wants to open a savings acct with the $500 he just got paid (which btw he never paid income taxes on).  Great, good for BOA.  Account opened.


Now, you offer him a credit card with a $5000 limit.  After all, we don't want to lose money on the deal.  He accepts.  Pays let's say $100 to get the card and 20% interest.  Great, good for BOA you just made $$ again.


Jose runs to his local Best Buy and purchases a new PS3, 42" plasma TV, 3 CDs, and an iPod.  Purchases total $3500.  Ring it up on my new BOA card please. 


BOA send the bill to the address of record to collect the money.  Jose has moved on to another job in another city (taking his TV, PS3, iPod and CDs with him).  What now?  Oh, let's keep his $500 from his bank account.  Great, fine.  Jose's happy.  You're down over $2000 in just a weekend with Jose. 


Who wins in this scenario?  BOA or Jose?  Multiply that by millions and I think you begin to understand why looney started the thread. 


I don't mind immigrants coming here for a better way of life.  None of us are probably more than a couple hundred years or less away from our ancestors doing that.  I'm glad they did.  I'm more glad they did it right.  




Feb 16, 2007 7:37 pm

If you lock the doors to your house, then you support stricter border controls.

Feb 16, 2007 8:06 pm
Spaceman Spiff:
exdrone:

Hasn't the great Jones equity marketing department come up with an analogy to help you understand how banks make money.  I would imagine that Fes should be on your branch TV any time now explaining that illegal aliens have nipples too and BAC has figured out how to milk them.



No, we understand how banks make money and this one doesn't really make sense.  Yes, they charge high interest rates and there is a fee upfront.  Let's play the what if game.


What if you are BOA and you have Jose (name changed to protect the innocent) the illegal alien at the desk in front of you.  No SS#, fake drivers license, temporary address.  He wants to open a savings acct with the $500 he just got paid (which btw he never paid income taxes on).  Great, good for BOA.  Account opened.


Now, you offer him a credit card with a $5000 limit.  After all, we don't want to lose money on the deal.  He accepts.  Pays let's say $100 to get the card and 20% interest.  Great, good for BOA you just made $$ again.


Jose runs to his local Best Buy and purchases a new PS3, 42" plasma TV, 3 CDs, and an iPod.  Purchases total $3500.  Ring it up on my new BOA card please. 


BOA send the bill to the address of record to collect the money.  Jose has moved on to another job in another city (taking his TV, PS3, iPod and CDs with him).  What now?  Oh, let's keep his $500 from his bank account.  Great, fine.  Jose's happy.  You're down over $2000 in just a weekend with Jose. 


Who wins in this scenario?  BOA or Jose?  Multiply that by millions and I think you begin to understand why looney started the thread. 


I don't mind immigrants coming here for a better way of life.  None of us are probably more than a couple hundred years or less away from our ancestors doing that.  I'm glad they did.  I'm more glad they did it right.  



Further on the scenario.  Jose ,now moved to another town becomes HoseB.  New fake drivers ID, still no SS#, new temporary address.  Same scenario, new stuff from Best Buy or McMahans.  Then he becomes HoseC in another town.... same thing.


The scenario is endless.  Because of all the credit card losses the companies will have to raise their prices on goods to make up for the losses.  Goods probably delivered by HoseD who also is applying for a nifty new credit card.


I'm only one generation from immigrants (my Grandfather and Grandmother),who couldn't speak any English. In fact my ancestors spoke a language almost no one understands or can pronounce(Welsh).  I have the greatest admiration for them. But as Spaceman says they did it right.


I see nothing but disaster in this scenario. I also see a big backlash for B of A with conservative investors. 

Feb 16, 2007 8:35 pm

BL,



When you refer to conservative investors are you saying as in "risk-

averse", politically conservative or just plain anti-immigration paranoid

(Americans are losing our good paying jobs to Jose...)protectionists?



If you think BAC is heading towards ruin, then you should know that

despite Bank of America's compelling interest in Latino markets, it was

arch-rival Wells Fargo that kicked off the competition in 2001, when it

became the first U.S. bank to accept identification cards from Mexican

consulates to open an account.



Since then, Wells has opened more than 1 million accounts for Mexicans

using the consular card. It also accepts Guatemalan, Argentine and

Colombian identity cards. The assumption is that most immigrants using

the cards to identify themselves are here illegally.



Citibank already issues credit cards to some immigrants without Social

Security numbers if they have taxpayer identification numbers. Citi issues

such cards under its own brand and the brand of its subsidiary, Banamex

USA.



Any rational person can agree that Mexicans and immigrants in general

did not invent identity fraud, credit card fraud and mortgage fraud. Just

read the papers and you'll see that corporate America does just fine in

those areas without them [immigrants].



I'm debating whether you are instigating controversy or if you truly

believe what you've written. If its the later, then re-read your own

signature.



Feb 16, 2007 10:06 pm
doberman:

If you lock the doors to your house, then you support stricter border controls.



Feb 19, 2007 6:09 pm

http://www.10news.com/news/11039022/detail.html


Don't you think that movements like this will be eventually hurting BofA's bottom line?  I don't plan to encourage any new investments in this company until they get this straightened out. I have already had 3 customers liquidate substantial stock positions as well.  They called me and requested the sales.  I can't imagine that I am the only FA that has had clients that are hopping mad.

Feb 19, 2007 8:24 pm

Not a very good PR move. In terms of the North American economy, why not offer them credit, or anything else that levels the playing field? How is this hurting anyone or anything, other than addressing an economic reality.

Feb 19, 2007 8:39 pm
babbling looney:

They called me and requested the sales.  I can't imagine that I am the only FA that has had clients that are hopping mad.





The credit losses on this will be very impressive, and there will be a
fair bit of lag time as it takes 60+ days for an account to become
seriously delinquent.



BAC is begging for a wave of credit card fraud
and illegals going wild with the card and then moving on in life (w/ a
new 60in plasma TV). Retailers will get sick of this as well, b/c one
of the best forms of CC fraud is return fraud to earn gift
certificates.

Feb 19, 2007 8:43 pm
AllREIT:

wave of credit card fraud





Better than this is check fraud combined with the CC.



Get a new no-doc account. Fund it, order extra checks and go wild with
the checkbook and credit card. The checks are an added bonus, since w/o
electronic presentment no one will know the account is hopelessly
overdrawn.




Feb 19, 2007 8:57 pm

If it weren't for an inverted yield curve and sub-prime mortgage capitulation

to come, I'd gladly take the other side of this trade. Those shareholders that

are seling must grow their own vegetables.



I've got popcorn in the micro to watch/witness this anti-immigration orgy/

lovefest that you guys are exhibiting. Have you forgotten how hard it is to

get a bank to give you a loan or a line of credit?   



Thanks for the "the migrant worker with the $500 car and $3000 plasma..."

that's a pisser.

Feb 19, 2007 9:36 pm

Jose runs to his local Best Buy and purchases a new PS3, 42" plasma TV, 3 CDs, and an iPod.  Purchases total $3500.  Ring it up on my new BOA card please. 


Who cares?


The credit card business has some pretty sophisticated players, I'd be surprised if this is anything but a bad PR move.


Does anyone here really doubt that Mexican Americans, legal or otherwise, are not so important to this North American economy as to allow our capitalist market find them, free from the self-interested paranoia of the media and our politicians? Is this really the " registered representative " forum ?


Allreit, you sound like a cranky old person on this one.

Feb 19, 2007 10:23 pm

Have you forgotten how hard it is to
get a bank to give you a loan or a line of credit?


Eff no. I haven't forgotten. I used to be a commercial lender.  This new move is without any of the checks and secondary precautions that I operated under. And it pisses me off. 


All they need to do is have a checking account for a short period of time, with no overdrafts and an ID card from their consulate. A card that is easily counterfeited and there is no way to verify the legality.  Ta Dah instant credit!!!!  It doesn't mean that you have to be an illegal alien to play this little game.  Anyone who wants to pretend to be a person without a Social Security number, can get a fake ID from an ID mill saying they are from Romania or Mexico or where ever.  Did you never get a fake ID so you could drink under age????   Heck why stop at one card.  Let's open up multiple accounts under multiple fake IDs  in multiple banks and get lots of credit cards.  After all who is going to be able to track you down.....you don't really exist.


WHO CARES?? are you brain dead??  Do you understand nothing about economics.  I know you live in happy joy joy land from the tenor of your advice but try to face reality.


The companies that are losing money on noncollectable debt care. They are going to pass the losses on to the rest of the people who are paying their debt in the form of higher interest rates and fees.  I care, because I am one of those people. The companies that are selling the goods that are not collected on care.  They don't get reimbursed at 100% all of the time for their losses.  To cover those loses the cost of goods will go up. The businesses that extend additional credit to deadbeats who have obtained instant credit with no accountability may soon become the next target in the scam machine: they care.


Yes, this does belong on a RR web site discussion if it impacts the economic viability of companies that we are recommending to our clients.


Does anyone here really doubt that Mexican Americans, legal or otherwise, are not so important to this North American economy as to allow our capitalist market find them, free from the self-interested paranoia of the media and our politicians?


This sentence makes no sense. Are you trying to say that if the illegal aliens (illegal=breaking the law) are making people money it's OK.  We should allow people to break the law as long as it is important to the economy?   So, by that reasoning if the underground sex slave and child pornography trade was an economic boon to the economy, it's Ok ....and we should recommend the stock in the Kiddies Gone Wild Porn Video business?  By capitalizing on this market don't you think we are sacrificing our integrity?  I do.  You don't I take it.

Feb 20, 2007 2:08 am

WHO CARES?? are you brain dead??  Do you understand nothing about economics.  I know you live in happy joy joy land from the tenor of your advice but try to face reality.


The companies that are losing money on noncollectable debt care. They are going to pass the losses on to the rest of the people who are paying their debt in the form of higher interest rates and fees.  I care, because I am one of those people. The companies that are selling the goods that are not collected on care.  They don't get reimbursed at 100% all of the time for their losses.  To cover those loses the cost of goods will go up.


So you are saying that if Mexicans in America get credit from B of A, the cost of big screen TVs at Best Buy will go up for everyone.


Yes, this does belong on a RR web site discussion if it impacts the economic viability of companies that we are recommending to our clients.


I think its a great forum topic. What I can't believe is the apparent socialist whining and apparent hypocracy. " We'll give you a job to help harvest our crops and build our houses, regardless of your immigration status, but you can't have any credit card (a convenient and cashless way to handle money), because " Jose" might blow it on a big screen TV and be irresponsible about making the monthly payments.


Do you understand nothing about economics.  I know you live in happy joy joy land from the tenor of your advice but try to face reality.


The layers of irony here are amusing. I think the economic ignorance in this country is a root problem. As I recall, you are a big fan of selling annuites. Don't "give" credit cards to the people who are maintaining our successful economy, though.


And then, when an otherwise enlightened client calls up and wants to dump the B of A stock as an apparent emotional reaction to media political correctness pandering (their "illegal") you pander to your client's wishes. It all just seems to be a bit hypocrytical, I'm sure I'm guilty of being hypocrytical in some ways, too.

Feb 20, 2007 2:24 am

Are you trying to say that if the illegal aliens (illegal=breaking the law) are making people money it's OK.  We should allow people to break the law as long as it is important to the economy?  


Are you serious here? Last I checked, someone is giving these people jobs - they, illegal = breaking the law - are not just standing on street corners, sucking up resources. Do you really have a handle on what is going on in our economy right now? I wonder what is really driving productivity in the American economy. I wonder is our unofficial policy is, let "them" in to take the jobs that let some of "us" practice comparative advantage, and focus on more value added tasks to help us compete in a global economy where labor itself is increasingly commoditized - so that we can compete with the developing economies of Southeast Asia and Brazil and China.


Frankly, I commend B of A for not being hypocritical. Sure, its a profit center activity - but it is in no way unpatriotic or exploitative. Rather it recognizes a reality - that America is blessed to have guest workers, illegal aliens, and permanent immigrants that come from a hard working, family oriented and fun loving culture that loves God. Since you say, By capitalizing on this market don't you think we are sacrificing our integrity?  I do. , and you equate all of this with legalizing child porn and all, it is clear where you stand.


Anyway, I'll let you fight that battle - if you are a conservative, I am dumbfounded as to how you could choose to take on the prosecution of " illegals" in a free economy. Okay, we need some controls, don't make a battle out of it. If you are a liberal, you are just trying to practice union economics. I think the B of A can look out after itself, thank you.