Category: ethics

Our Continuing Coverage – More On BRICKED Bank!

On By southwerkIn business ethics, Capitalism, ethics, Philosophy of Business2 Comments

Cameron Hope organized the bricking and had this to say. –

‘We blocked the doorway as a way of saying that the banks are open but the safe is shut.

‘The banks are stifling the recovery from the recession by not lending businesses any money.

‘Savers are getting nothing, borrowers are getting nothing and the banks are doing whatever they like. Some of the banks are even owned by the taxpayer and still they won’t lend.

‘This protest is saying enough is enough and the Government needs to step in and make the banks lend.’

The Daily Mail’s Make the Banks Lend campaign, on behalf of small firms turned down for credit, argues that the banks have money to spare, thanks to enormous funds provided by the taxpayer.

Instead of lavishing this cash on bankers’ bonuses, banks should be lending it at affordable rates to small enterprises – the backbone of the economy. Small and medium concerns provide 57% of all private sector jobs.

It is clever protest that is getting headlines around the world. However, Barclays Bank was not the original target. The protesters were unable to brick up the offending bank. So they picked another bank conveniently located. Press reports indicate that Barclays has a good reputation for continuing to give out small business loans.

If you read this column, you know I’m no shill for the banks. The offending bank was actually “Natwest.” If you want to deny them business, please do, but Barclays did not deny this businessman and his friends a loan.

(One of my clever readers, M. Perry, adds a helpful comment. –
Nat West was the original target to be bricked up because of its location in the centre of Bournemouth. HOWEVER, HSBC was in fact the bank that refused the loan, jeopardising Mr Hope’s business.)

James Pilant

Bank BRICKED Closed In Loan Dispute!

On By southwerkIn business ethics, Capitalism, ethics

In Great Britain, in the city of Bournemough, a Barclays bank was bricked closed by a group of protesters angry that the bank was not willing to make loans to small businesses. They said and I quote that it was “like talking to a brick wall.” The angry protesters removed the wall after two hours after the police ordered them to do so.

One of the protesters said –“Over the last year we’ve had different problems with the banks thinking things are getting better and better but they are not, they are getting worse.

“Any charges they put on nobody can argue with them, that’s if you can get any money in the first place.

“Overdrafts have been taken away from us, it is never-ending. You go into a bank and there’s nothing there, the bank’s open but the safe is shut”

“You go into a bank and there’s nothing there, the bank’s open but the safe is shut.”

Maybe some of our bank customers know how to brick up a building?

James Pilant

International Price Fixing

On By southwerkIn business ethics, Capitalism, Economic measurement, ethics, Government Failure, Philosophy of Business

You don’t make real money by competing. You make real money by not competing.

Price fixing is one of the tried and true methods of generating great profit. You form an alliance with all the others in your business and agree nobody gets a better price.

China Airlines has agreed to pay 40 million dollars in fines for the practice.

They were fixing international cargo rates for shipments to the United States from 2001 to 2006. I find it difficult to believe that their profits were anywhere near as small as 40 mil. Since it was a conspiracy, who else was involved? I want to see some prosecutions. I want to see some justice. Although the pro-business policies of the current administration would seem to mitigate any real penalties for these kinds of practices.

James Pilant

Are Businessmen Smarter Than Children? (via Pilant’s Business Ethics Blog)

On By southwerkIn business ethics, Capitalism, Corporate Social Responsibility, Economic measurement, ethics, Philosophy of Business

One of my more popular efforts – a blast from the past, so to speak. I’m sure many haven’t seen it and I had a lot of comment on it (mainly on Facebook, where my blog also appears).

James Pilant

Are Businessmen Smarter Than Children? When I was in law school we were taught that when a business had to decide whether or not to break the law, if the penalty was a simple fine, you would just decide which was least expensive and pay that cost. So, if the fine were cheaper than your profits, break the law and pay the fine. I was always troubled by that, the assumption that a fine was just a part of doing business. My perception is that this is major current of thought in modern bus … Read More

via Pilant's Business Ethics Blog

Blockbuster Files For Bankruptcy Protection

On By southwerkIn business ethics, Capitalism, ethics, Philosophy of Business

Are cable companies next? All over America, the little red boxes and the home computer are building market share. The old ideas, once new and exciting disappear.

I can hope (and my hopes get dashed regularly) that this new environment will actually feature competition. For in America, the free market is like Christianity, a great idea that we haven’t quite got around to yet.

I would like to see the day when the exorbitant rates charged by cable for “packages” designed to maximise their profits while providing dozens of channels no one wants is all a thing of the past. Customer satisfaction and product excellence are also much discussed and preached concepts. Not only a shallow religion but once again not often practiced.

James Pilant

He’s Back! Like Hannibal Lector, He Just Keeps Going!

On By southwerkIn business ethics, Capitalism, Corporate Social Responsibility, ethics, Government Failure, Philosophy of Business

I’ll let the picture speak for itself.

What is Fair Trade? (Part 3) (via Get Aktiv)

On By southwerkIn business ethics, Capitalism, Corporate Social Responsibility, Economic measurement, ethics, Philosophy of Business

The third part in a series. I recommend you read all three. This is a different way to handle the issue, one that is sustainable and provides an actual human touch to capitalism.

The World Fair Trade Organization defines “Fair Trade” as –

“a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of marginalized producers and workers…”

James Pilant

[This is the final post in a 3 part series by guest contributor Natalie Armstrong, from Bachhara. Click here for Part 1 and Part 2] Fair trade organizations are not perfect, nor do they claim to be. There is still much work to be done and there always will be. It requires continual development and ongoing reassessment. The key however is that fair trade organizations show commitment to the preservation of these principles. Without a doubt, there … Read More

via Get Aktiv

Wells Fargo Ordered To Pay 203 Million Dollars In Fees

On By southwerkIn business ethics, Capitalism, ethics, Philosophy of Business1 Comment

Wells Fargo is one of the four largest banks in the United States. The bank received 25 billion dollars in TARP money (the bailout). But the bank charged 203 million dollars in overdraft fees since 2001 in violation of the law. They made their money by paying out checks and card fees largest to smallest instead of in the order they were received. This enabled the bank to stack overdraft fees.

Federal judge William Alsup described what the bank was doing as “unfair and deceptive business practices.”

He ordered the bank to pay back the 203 million dollars they made using the practice of largest to the smallest.

Here’s a news story reporting the decision –

I love irony, the irrational collision of one situation with another – and for that irony lets look at

Wells Fargo’s Vision Statement –

“We want to satisfy all of our customers’ financial needs, help them succeed financially, be the premier provider of financial services in every one of our markets, and be known as one of America’s great companies.”

Apparently manipulating the order of payout to artificially increase the number of overdraft fees “helps consumers succeed financially.”

Here’s a very different take on overdraft fees –

Are all overdraft fees always unfair? Of course not. If there was no penalty the banks would be faced with an avalanche of bouncing checks. There are many defenders of banks who say they are justified. Wrong! That’s not the question. If you only ask it one way, that is, should banks be able to charge overdraft fees, the argument always goes to the bank. But the question here is “are the fees reasonable.”

What does it cost a bank to process an overdraft?

Why doesn’t the bank charge based on the size of the overdraft rather than charging the same for $1.25 overdraft as for a much larger amount?

How much money does the bank make on overdrafts?

When you start looking at the facts, it becomes a messy problem. There are a lot things to figure in to the situation. Nevertheless, Wells Fargo’s practice is simply unfair.

There are other banks that use the practice. Will they be forced by the courts to payback the fees as well? Wells Fargo is appealing the decision. Stay tuned. I’ll tell you how it comes out.

James Pilant

Buffett Says No Second Recession – I Hope He’s Right!

On By southwerkIn business ethics, Capitalism, ethics, Philosophy of Business, shareholder1 Comment

In an item from Yahoo News, Buffet is bullish on the economy. Normally I would place a lot of importance on what he has to say. However, as you see in the article, he company just made a 27 billion dollar deal that stands to lose considerable sums in a pessimistic environment. He may be more stoking the stock price than giving a reasoned opinion.

Warren Buffett ruled out a second recession in the U.S. and said businesses owned by his Berkshire Hathaway Inc. are growing.

“I am a huge bull on this country,” Buffett, Berkshire’s chief executive officer, said today in remarks to the Montana Economic Development Summit. “We will not have a double-dip recession at all. I see our businesses coming back almost across the board.”

Berkshire bought railroad Burlington Northern Santa Fe Corp. for $27 billion in February in a deal that Buffett, 80, called a bet on the U.S. economy. The billionaire’s outlook contrasts with the views of economists such as New York University Professor Nouriel Roubini and Harvard University Professor Martin Feldstein, who have said the odds of another recession may be one in three or higher.

“I’ve seen sentiment turn sour in the last three months or so, generally in the media,” Buffett said. “I don’t see that in our businesses. I see we’re employing more people than a month ago, two months ago.”

Roubini has been very successful at predicting economic problems. His web site is here. It would be a good decision to make it a favorite of yours. He knows his business and has no railroad purchase to influence his judgment one way or another.

James Pilant

Four Thousand Children Die Each Day From The Lack Of Clean Drinking Water!

On By southwerkIn ethics4 Comments

Bloggers all over the world are joining together to call attention to the lack of clean water and its health effects. WaterAid keeps a web site.

Here’s one of their commercials –