Gov't Aid is Actually a Hindrance. Might be a Good Thing.

During my sophomore year of college, I asked my parents for $100 to help with some of my expenses. They were more than happy to help. But they made me regret asking.

They would call me almost everyday, asking if I was okay. They'd ask if I was starving. When I visited, they'd question me about any new clothes. They would tell me I should only wait for sales. They'd constantly lecture me about going out to eat. If I had to go out to eat, they would tell me how I should order. They actually told me not to fly home for Thanksgiving because I would be flying back for Christmas in just few weeks. Et cetera, et cetera, et cetera...

In hindsight, I would've rather starved then ask for that money. But I can't say I didn't learn a valuable lesson: never ask parents for money, EVER AGAIN.

Banks with TARP Money
The government has been giving a lot of shit to banks who have taxpayer money via the TARP. Among other things, the government wants to put a cap on compensation. More recently, Morgan Stanley and Northern Trust have come under pressure for sponsoring golf tournaments.

Gov't Mismanagement
Maybe, managers don't need to be paid much and banks don't need to sponsor events. But when you cap pay, you lose top performers to the competition. Many boutique banks are already reporting an influx of this type of talent. When you stop sponsoring events, you risk losing the reputation of your brand.

Like Depositing Money at the DMV
You see, the government wants banks to be run like the Post Office and the DMV. Dirty floors, limited hours, and long lines. It's cheaper to fund operations, but they'll lose a lot of business to the competition. And this is not what I want when my tax dollars are being used to invest in these very institutions.

Payback Time
This bank bailout came with a lot of strings attached. It turns out that government aid is actually a hindrance. Gov't influence is destroying the value of these firms. The managers realize this, and they'll never forget it.

Goldman Sachs and JP Morgan said they never wanted TARP money, and they plan to pay it back ASAP. Northern Trust says they're doing everything they can to pay back the TARP money. They HATE having the government this close.

A Bright Future
I've become much more responsible with my personal finances. Nowadays, I don't think just about earning money. I think about earning and saving enough money so that I never have to ask for money out of desperation from anyone ever again.

Once the banks start paying back the government money, I believe that they'll do whatever they can to keep the government away.