Implementing the nationalization agenda in private

This topic has 55 replies, 7 voices, and was last updated 15 years ago by Arraya.

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October 3, 2009 at 9:21 AM #16438

bomilo
Participant

The main aim of the intended nationalization of banks in the United States was to ensure
• Faster growth
• Reduction in regional imbalance of economic activity
• To make the banking system reach out to the small man in rural and semi-rural areas
• Extend banking facilities to areas hitherto not served by banks

Banks did not move into the rural areas in earlier times due to the fear of running unprofitable branches. However, the government wanted them to not only mop up the potential savings but also meet the credit gaps in agriculture, small-scale industries and other neglected sectors of the economy. The aim was to bring a large area of economic activity within the organized banking system.

The two significant aspects of the then intended nationalization were
1. Rapid branch expansion and
2. Channeling of credit according to priorities

If the nationalization project was implemented, the growth and development of the then banking system would have been phenomenal. By the end of the second decade of nationalization, banking would have been relatively sophisticated, with a wide network of branches, huge deposit resources and extensive credit operations.

The outburst of banking activity during this period would have been such that it may be described as a banking explosion. In terms of the branch licensing policy laid down by the lead bank, the accent was on opening new branches in
• Rural and semi-rural areas
• Backward regions and
• Under-banked states

Such an approach was intended so that the inter-regional disparities could be reduced. However, this policy has wreaked havoc in many of the developing countries. But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.

October 3, 2009 at 9:47 AM #463454

Hobie
Participant

Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

True enough that in times past banks and other business made business decisions to exclude rural areas due the smaller market potential. However, rural areas today are serviced well by FedEx, satellite internet, and cell service. I don’t see any imbalance of economic activity due to distant location. Banking included.

I prefer capitalist solutions over government mandates any day.

October 3, 2009 at 9:47 AM #463799

Hobie
Participant

Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

True enough that in times past banks and other business made business decisions to exclude rural areas due the smaller market potential. However, rural areas today are serviced well by FedEx, satellite internet, and cell service. I don’t see any imbalance of economic activity due to distant location. Banking included.

I prefer capitalist solutions over government mandates any day.

October 3, 2009 at 9:47 AM #463872

Hobie
Participant

Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

True enough that in times past banks and other business made business decisions to exclude rural areas due the smaller market potential. However, rural areas today are serviced well by FedEx, satellite internet, and cell service. I don’t see any imbalance of economic activity due to distant location. Banking included.

I prefer capitalist solutions over government mandates any day.

October 3, 2009 at 9:47 AM #464076

Hobie
Participant

Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

True enough that in times past banks and other business made business decisions to exclude rural areas due the smaller market potential. However, rural areas today are serviced well by FedEx, satellite internet, and cell service. I don’t see any imbalance of economic activity due to distant location. Banking included.

I prefer capitalist solutions over government mandates any day.

October 3, 2009 at 9:47 AM #463262

Hobie
Participant

Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

True enough that in times past banks and other business made business decisions to exclude rural areas due the smaller market potential. However, rural areas today are serviced well by FedEx, satellite internet, and cell service. I don’t see any imbalance of economic activity due to distant location. Banking included.

I prefer capitalist solutions over government mandates any day.

October 3, 2009 at 10:18 AM #463809

SK in CV
Participant

What is the context of your thesis? What time frame are you talking about? When did this ” intended nationalization of banks in the United States” begin? Five years ago? Fifty years ago? What mechanism was implemented for this “nationalization” to occur? Was it legislative or regulatory? In other words, you may have a point, but without context, I have no idea what it is.

October 3, 2009 at 10:18 AM #464086

SK in CV
Participant

What is the context of your thesis? What time frame are you talking about? When did this ” intended nationalization of banks in the United States” begin? Five years ago? Fifty years ago? What mechanism was implemented for this “nationalization” to occur? Was it legislative or regulatory? In other words, you may have a point, but without context, I have no idea what it is.

October 3, 2009 at 10:18 AM #463272

SK in CV
Participant

What is the context of your thesis? What time frame are you talking about? When did this ” intended nationalization of banks in the United States” begin? Five years ago? Fifty years ago? What mechanism was implemented for this “nationalization” to occur? Was it legislative or regulatory? In other words, you may have a point, but without context, I have no idea what it is.

October 3, 2009 at 10:18 AM #463881

SK in CV
Participant

What is the context of your thesis? What time frame are you talking about? When did this ” intended nationalization of banks in the United States” begin? Five years ago? Fifty years ago? What mechanism was implemented for this “nationalization” to occur? Was it legislative or regulatory? In other words, you may have a point, but without context, I have no idea what it is.

October 3, 2009 at 10:18 AM #463464

SK in CV
Participant

What is the context of your thesis? What time frame are you talking about? When did this ” intended nationalization of banks in the United States” begin? Five years ago? Fifty years ago? What mechanism was implemented for this “nationalization” to occur? Was it legislative or regulatory? In other words, you may have a point, but without context, I have no idea what it is.

October 3, 2009 at 10:45 AM #463479

Arraya
Participant

[quote=Hobie]Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

I prefer capitalist solutions over government mandates any day.[/quote]

Doesn’t everything the Fed do negate the free market argument. They are the invisible hand.

October 3, 2009 at 10:45 AM #463824

Arraya
Participant

[quote=Hobie]Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

I prefer capitalist solutions over government mandates any day.[/quote]

Doesn’t everything the Fed do negate the free market argument. They are the invisible hand.

October 3, 2009 at 10:45 AM #463287

Arraya
Participant

[quote=Hobie]Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

I prefer capitalist solutions over government mandates any day.[/quote]

Doesn’t everything the Fed do negate the free market argument. They are the invisible hand.

October 3, 2009 at 10:45 AM #463896

Arraya
Participant

[quote=Hobie]Doesn’t your last statement, “But banks like LoanMax of the rod aycox fame have achieved much mainly by doing market research even in the rural areas and by identifying the prospective customers needs.” — a free market solution — completely negate the argument for nationalization of the banks?

I prefer capitalist solutions over government mandates any day.[/quote]

Doesn’t everything the Fed do negate the free market argument. They are the invisible hand.
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