By Mike Moebs
It’s that time of year again, when traditional tunes like The 12 Days of Christmas dance in our heads. We try to recall what our True Love will be sending on the fourth, fifth or sixth day, and wonder where we’re going to put those six geese a-laying.
The song’s merry countdown of 12 days is often adapted in the financial press using current costs for the 12 gifts. In this version, the gifts depict the current state of financial services.
So sing along, just fill in the number before each stanza:
On the ___Day of Christmas My True Love Gave to Me:
A Partridge in a Pear Tree
Said to be the most defensive of all fowl, a female partridge is a ferocious protector of her nest, chicks and territory. Think: Janet Yellen. The Fed Chair perches upon the Federal Reserve System pear tree, distributing economic fruit. Will she go out on a limb next year?
Two Turtle Doves
A symbol of devotion for centuries, turtle doves form strong pair bonds that can last for years. Often used as sacrifices in ancient times, they are also birds of passage. So what better representative of two turtle doves than the U.S. Congress – the House and Senate? Through their passage of legislation they have caused many sacrifices by depositories, their customers and members.
Three French Hens
French hens actually do lay red eggs. And who has laid more red eggs than the big three banks—JPMorgan Chase, Wells Fargo and Bank of America. Together they precipitated such financial misfortunes as the London Whale currency problem, overdraft fee escalation, and mortgage meltdown. Parlez-vous francais?
Four Calling Birds
“Calling Bird” is an Americanization of the traditional English “Colly Bird,” a song bird. In Old English “Colly” means black. A black bird sings? This must be four crows, which today are the Fed, FDIC, OCC and NCUA, who are crowing their way through regulation.
Five Golden Rings
Five golden rings bring to mind the Olympics symbol. So let the financial games begin with the best known nose rings: Truth-In-Lending, Truth-In-Savings, funds availability, electronic funds transfers and unfair deceptive acts and practices. Can’t wait for the 2016 games to kick off!
Six Geese-a-Laying
The six geese, AKA legislators, (you, and they, know who they are) laid the biggest egg in financial history, and it wasn’t golden: the Dodd-Frank Act. And the eggs just keep on coming. The big question is: are the eggs rotten?
Seven Swans-A-Swimming
The seven governors of the Federal Reserve System often swim among their seven powers: peering into their crystal ball at interest rates, trying to serve the marketplace, enlightening legislators on the economy, convincing others they know what they are doing, helping the stock market grow, trying to be leaders, and showing mercy for U.S. citizens who have to live with their decisions.
Eight Maids A-Milking
Today’s eight milk maids are considerably more powerful than those of yore: The Secretary of the Treasury, Fed Chair, Chair of Senate Banking Committee, Chair of the House Financial Services Committee, Director of the FDIC, Comptroller of the Currency, President of the National Credit Union Administration, and Director of the Consumer Financial Protection Bureau. These powerhouses want to use Section Eight of the Federal Reserve Act to reduce the herd of 12,000 financial institutions to a mere eight, to make their milking easier.
Nine Ladies Dancing
Over 80% of the workers in financial services are women. Using the nine-digit routing numbers of the Uniform Commercial Code, they route over 200 billion transactions a year–quickly, accurately, and with 100% settlement daily. No wallflowers, these ladies will soon out dance the men in financial services as gender equality becomes more than Title 9.
Ten Lords A-Leaping
In the fall of 2008, ten mega-investment institutions and shadow banking organizations were forced to become chartered banks to help regulators calm the mortgage meltdown. Now these “new banks” are leaping through the financial services landscape hailing their past ventures while trying to forecast the future.
Eleven Pipers Piping
Eleven national trade associations are piping their way through Lobby Land promoting free markets and less regulation. These modern day pipers are the financial services heralds, spreading the good news not with sandals and walking sticks, but Italian made shoes and private jets.
Twelve Drummers Drumming
Drum roll, please! The 12 presidents of the Federal Reserve Banks are constantly drumming the Fed’s doctrine of high employment and low inflation. Missing in the orchestra are the violins of money supply, the wind instruments of change and the other instruments needed to orchestrate a harmonious, balanced economy.
Here’s to a successful 2016!
Mike Moebs is economist and CEO at Moebs $ervices, Lake Forest, Ill.