Do you have the Old or New kind of Term Insurance?

As you read the title of this post, you may be thinking: “I didn’t know that there have EVER been changes made to term insurance!” Don’t be distressed, you are not alone! In this post, I hope to outline a few KEY points when it comes to Term Insurance to make sure you are informed about what’s in your safety deposit box.

I could make this article as lengthy as I wanted, but instead I’m going to try to stay as concise as possible. This is valuable information. If you don’t know it, you could be putting those closest to you, in grave future financial danger. You might be thinking at this point how much protection costs, and how little you would like to add more to your current bill. That’s the beauty of this- it may not cost a cent more!

First, let me elaborate on the purpose of Term Insurance. Term insurance has a two-fold purpose.

1.)    Term insurance is there to provide funds to your loved ones  should you pass away at an unexpected age.  That’s pretty straight forward. It’s risk management for premature death.

2.)    Term insurance protects your insurability. Most people don’t know that MANY newer insurance policies have what are called “conversion privileges“   These privileges allow you to convert the term policy to a permanent policy without having to go through underwriting again. (No blood/UA/ Dr. Statements/ ect.)

The reason conversion options are important is very simple. The things that used to kill us, don’t anymore. Often times you have a major health event, and are simply left uninsurable in your older age.  Had you obtained a policy with good conversion options, your rates would be SIGNIFICATNLY lower to convert the policy than to buy a new one.   This conversion option is not more expensive, if there is a charge for it, the charge is minimal. The only reason people don’t have it is not knowing to look for it.

You may be wondering if your policy has “conversion privileges” on it. There is an easy way to tell. Find your policy and look on the first few pages. It should mention convertibility options. You can also contact your local insurance agent. My recommendation is to find an Independent Insurance Broker.  You will get an unbiased approach from a broker, whereas if an agent’s only company sells a policy that DOESN’T have conversion options, you may not have all the options correctly presented to you.

That said, the time to check these things is NOW! Mortality tables have risen again, and the cost of term insurance has decreased. Your policy should be reviewed at least every two years to make sure you have the most up-to-date rates, the best special options, and you don’t end up in the wrong policy when that major health event happens.

A quick case example, just so you can put numbers to what I’m referencing. I personally had a couple in my office the other day, who both had 1mil policies on themselves.  They purchased these 20year term polices 10 years ago, so they had 10 years left. These policies had NO conversion options. Since over the last decade, mortality tables have SIGNIFICANTLY decreased, and their health was as good as it was in the previous decade, they were able to take out two new policies.

These new policies had the same death benefit (1Mil)

These new policies were 20yr term (This means they got an additional 10 years of coverage locked in at the low term rate.)

These new policies had excellent conversion privileges up until the very last day of the policy.

These new polices cost $8 less per month.

Don’t put it off! If you have a policy that hasn’t been looked at in OVER 2 years, if you are in good health, and if you want to make absolutely sure you have the best product, get your policy reviewed today.

As always- Feel free to contact me with a call or text at 405.293.EASY, or 405.620.3104, or request a call, quote, or comparison .

I hope everyone has a great Thanksgiving!

God Bless,

-Sam

For those of you who don’t know, back in the day, I used to teach private baseball lessons. This was a phenomenal experience in my life, and I was blessed with some of the best students. Recently, I got a call from one of my old students, asking if I would stop back in and give them a refresher course on hitting. It was while reviewing some of my hitting notes(which I developed and taught LONG before I was in the financial services industry) with this student that I found a STRIKING analogy.

My philosophy in hitting is very simple. It is: “To gather 100% of your available power, then deliver 100% of your gathered power at the baseball.” The purpose behind this philosophy is to break down a very complex action into something very simple to follow. I’m a firm believer in finding the simple path. I think the Lord gave us a simple path to follow in Matthew when he summed up all the commandments into giving the Lord your all and loving your neighbor. Think about it, try to break any other commandment and NOT break one of those summaries! I think it’s absolutely VITAL to have a focal point as you attempt to accomplish any task. Whether it’s focusing on giving the Lord your all as you walk your Christian walk, or not losing power during your swing as you attempt to hit a round ball with a round bat, you must have a clear point to focus on as you perform the action.

What I do that is unique in the financial services industry, is focusing on the process instead of the product. I have another analogy I would like to present you with:  You are going to ‘pinch hit’ in the 9th inning of game 7 of the world series of baseball. I have two gifts that I can give to you, and you may pick one. First, I can offer you any bat that has ever been swung by a professional player, or I can offer you the ABILITIES of any player. Which would you choose?      Obviously, the abilities are far more important than the bat! Unfortunately, when you think of financial services, you typically think of the new investment, the better rate of return, the ‘bat’ that will hit it further, when in reality, what really needs to be addressed is the swing! You can have the best ‘bat’, but with an inefficient swing, you will still have unfavorable results! My approach, is to work on the swing, use what ever bat you have, before we ever try to find a new bat to swing at game time.

Another comparison: Efficiency-

Efficiency is key in both baseball and your finances. Most young students will transfer more energy in their baseball swing through inefficient motion than they will ever direct at the baseball. Most adults will transfer more wealth in their lifetime through inefficient finances than they will ever accumulate.  You may be disagreeing to both points, you may be nodding your head to one, but I have seen BOTH many times. Whether it’s striding open and losing power to first base, or losing dollars in taxes, debt service,or opportunity cost,  there are simple mechanical rules that must be followed to give you the proper swing. When you have this efficient swing, than we can go to my ‘bat’ rack- I’m a broker and we can work with any investment you prefer.

These questions NEED to be answered. They CAN be answered with MATH, and not just opinions or hypothetical scenarios based on an un realistic rate or return.  If you don’t know the answer to one or all of these questions, don’t delay! Just like in baseball, your Christian walk, or you finances, you MUST have a focal point. If you are wasting energy in any direction OTHER than the focal point you are giving less than 100%. In this day and age, that won’t suffice. Don’t go another day wasting energy or wealth!

To learn more, Please go to LWSretirement.com  or feel free to Request a Call to set up your consultation appointment.

EasyInsuranceOK and Legacy Wealth’s Merry Christmas Give-away!

EasyInsuranceOK and Legacy Wealth are trying to get you into the holiday spirit! We are giving away a grand prize Flat Screen TV to one lucky fan! We also have a way to guarantee you win a prize! We know that those who have done business with us already are winning, and those who will do business with us soon will win as well, but we just wanted to sweeten the pie a little more this season! Get your entries today for the Grand Prize, and don’t miss out on the “How to win for sure!”

How to receive Entries:

1. Anyone (client or not) who recommends me even ONE person will be entered in the grand prize drawing for a Flat-screen TV! You AND the person recommended will receive an entry.
2. If you aren’t a client, you CAN recommend yourself! Fill out a Request a Quote, Compare ME, or call 293-EASY to receive your entry.

So! To get your gift this holiday season you can do any of the following:

1. If you are not a client, you can sit down with me for the first time. (1 entry)
2. Fill out a Compare Me/ Request a Quote form on EasyInsuranceOK.com (1 entry)
3. Recommend me a person on the referral sheet. (1 entry PER person recomended!)
4. Be recommended by someone! (Every person I sit down with gets an entry as well!)
5. How to win for sure! Recommend 5 people to me, and I will give you an ADDITIONAL $20 gift card! (Limit one per family)

HOW TO WIN FOR SURE:

(A Visual Aid for our Picture driven people)

How you receive: (5 entries) + ($20 gift card)

1. You tell me the names of 5 people who I can call on for Insurance.
2. You get 5 Entries to the drawing for the Flat Screen TV
3. You get a $20 Gift Card to any restaurant!
4. All the people you recommend get an entry for themselves! (If they win, you will have a right to demand a chance to watch the TV w/ them!)

(Friend)(Friend)(Friend)(Friend)(Friend)

                                 (Each one receives an Entry as well!)

(Entry)  (Entry)  (Entry)  (Entry)  (Entry)

***Drawing will be held December 22^nd. TV will be delivered the 23rd. A picture will be taken upon delivery, if you enter this drawing you consent to your picture being taken and posted. No Purchase Necessary. Spouses and Children of Legacy Wealth Strategies Employees are not eligible to win.***

May everyone have a blessing this Holiday season. Be blessing to receive a blessing!

       Since September is Life Insurance Awareness month, many of the blog posts will be themed that direction. One tremendous story I wanted to post was that of Lamar Odom (Click Here to watch his story on youtube)  Or Search for  ‘Lamar Odom Life Insurance’ .    It tells the stroy of a single mother, who, no doubt had hopes, dreams, and plans for the best, but also was prepared for the worst. Likely, at a limited monthly sacrifce, she put a self completing vehicle in place, that allowed her son to do all the things she dreamed for him! Perhaps, he even did a little more.  

I challenge you:   If you have not taken the time to get your coverage, DO SO today.  The process is simple, and often, for less than a few dollars a day, you can receive the coverage it takes to secure and protect your family’s future.  

**This is you!** (Click Here)  or seach youtube for A Legacy of Love. 

     Dream big, plan for the  best, but don’t forget to prepare for the worst. No one plans to fail, but many people fail to have a plan.

I want to extend a special welcome to our Touch 1140 listeners.  For those of you who don’t already know, you can tune in and hear our parent company, Legacy Wealth Strategies present a variety of Financial Topics every other Friday! Tune in, call in, or look-up online and listen in to Money Matters! For a complete schedule, or to leave a comment, (Which we might read live on the air!) Feel free to comment, e-mail, or go  to the contact page for more options. 

If you want to call in and ask questions during the show, here is that number!  You can call 1-866-818-5877 or 460-1140 or *1140 on your AT&T wireless phones!

Yesterday, my firm was on the radio discussing college funding. You may be wondering- Just what IS college funding, why would I want to know about it, or who would I need to be planning for? Don’t worry, I will be covering all that today.

First- I want to cover college savings. ( Which is more of a focused single area of your college funding gameplan.) Basically, it’s what you can do in advance!

WHO should be looking at College SAVINGS:

• Grandparents who want to see a Grandchild in School.
• Parents who want to see a child in school.
• High school students who are planning on going to college.
• ANYONE else who may want help send another person to college.

WHAT is college Savings?

• A method of setting aside money to help pay for the expenses of college. (Tuition, Room/Board, Books, FEES, Memberships, Transportation…)

WHEN should you start YOUR college savings plan?

• There are two main factors when it comes to any planning strategy: Time and Money. The sooner the better, because of the time value of money.

WHY should I look at college Savings?

• 30% of people don’t plan for college expenses for either themselves or their children.

• 35% of people plan to use loans to pay for their/children’s expenses.

1. The reason it is so critical to plan AHEAD, is because with loans, interest works against you. With planning, interest works for you.

NOW-  Onto College Funding:

I talk about college savings first, simply because I think it is a CRUCIAL part of your college funding plan. Not all college savings plans are created equal- you will want to make sure your plan doesn’t actually decrease the amount of Federal Aid you might have been eligible to receive. (Yes, our government does penalize people who plan ahead.) Also, it would be ideal that your Savings Plan be able to perform double duty. If you receive enough Aid/Scholarships, it would be advantageous to be allowed to access the college savings money for other purposes besides tuition – Retirement, Travel, ect- without a major tax liability. It is ABSOLUTELY CRITICAL that you have a properly structured plan. The strategies and information I will share with you can drastically change your financial outcome, and if you set up a plan without knowing them, you could be in serious financial jeopardy. Before we get into that however, I need to lay some groundwork.

There are TWO categories all monies for college must fall into: Self-Help and Gift Aid.

Self- Help would include:

• You College Savings
• Stafford Loans (Student)
• PLUS loans (Parents)
• Work Study

Gift Aid would include:

• Grants
• Scholarships
• Tuition Reduction (by the college)
• Financial awards

It’s important to make sure you pull from ALL available funding options for your college funding plan. I prefer to focus on the Saving for College in Advance and Gift Aid aspect, rather than Loans and Work Study.

Let’s talk about Financial Aid: Let me start be putting a quote here by US News and World Report: “Financial Aid has become a free-for-all that leaves most families baffled and confused.”

I say that, so you can know- you are not alone! To qualify for financial aid, there is one VERY crucial thing you must do. In fact, 100% of people who receive financial aid, do this. That thing is:  Apply!

Once you apply, the factors that determine your eligibility(EFC score) to receive aid are:

(EFC= Expected Family Contribution)

• Parent Income
• Untaxed  Benefits (529 plans ect)
• Parents Assets: Investments, Real Estate, 401k, Savings, ECT
• Student Income (Over $5250)
• Student Assets
• Parent’s age, number of dependents, and number attending college can raise and lower respectively.

What DOESN’T count towards your EFC?

• FICA
• Social Security
• IPA (Income Protection Allowance- First 25k for Family of 4)
• Student Income Less than $5250
• Primary Residence
• Asset Protection Allowance (30-75k depending on parents age)
• Certain retirement accounts and Annuities

Now,  there are three funding sources I want to mention: Private Sector, Federal Grants, and College Aid.

Private sector contributes 3.5% of total funding

Federal Grants contribute 12.9% of the funding

Colleges   contribute over 20% of the funding

Each college has different guidelines for how they distribute Aid, however, often you can have access to this information in advance. Having an academic and social resume that is enticing to colleges will drastically improve your chance of receiving aid above and beyond what you may receive after filling out your FASFA (Free Application for Student Aid).

Colleges want:

• Cover Letters
• Letters of recomendation
• Variety of HS courses (AP classes ect)
• Appeals! Don’t take the first offer, only 10% appeal their first award, but 90% of appeals are granted!

I know this has been VERY lengthy, but I wanted to get a lot of this information out. My goal is to come along side you, and help you pull back the curtain on how to fund college for your child, grandchild, or otherwise.  Please feel free to ask specific questions, either beneath the blog, emailed, or through the request a call section.

If you are in the position of wanting to plan for College Funding, College Savings, ect- Contact me today!

It’s a free consultation, but would is the cost of putting this off?

“No one PLANS to fail, but MANY fail to plan.

Recently it has come to my attention the massive amount of talk that is currently going on about our country’s economic state. People seem to be increasingly AWARE, but less informed than ever before. I think we are at a crucial time. There are so many issues and challenges which must be considered before making wise investment choices and considerations over the next decade. I have information that can and WILL change you/your families financial future, and if we don’t talk about it, you could be in serious financial jeopardy. The issues of our decade are fast approaching. The risk of loss looms greater than ever. I’m going to outline a few of these challenges-

“Ask yourself: does this seem like a pretty safe and sure time to make money? Do current events present more opportunity for gain or loss? Our economy is still struggling. Even after a series of programs designed to spur growth and create employment, neither has occurred. When will we end up paying again for the economic mistakes we have made and are still making? And it’s not just us.

• China is a bubble waiting to burst. They do not have enough water or food; 450 million people live on less than one dollar per day. They have approximately the same amount of Baby Boomers about to retire without the means to support them. Analysts predict the same things that happened here will happen to their banks, because of fake loan requirements in China.

• Japan has and will continue to struggle. After the earthquake and tsunami, Japan did not receive the same amount of aid that other disasters received, because of the perception that they did not need it. Demographically, Japan is the oldest country on the planet.

• The European Union will also face serious problems. Analysts predict Portugal, Italy, Ireland, Greece, and Spain (the PIIGS) will all surrender to their debt loads, and their fall will cause a domino effect. Germany, the world’s fourth largest economy, is also one of the oldest countries, with many more old people to support and not enough young people to pay for it. Germany will no longer be able to prop up the European Union. It will barely be able to take care of itself.

Finally, the findings in the 2011 DALBAR study are amazing. Even with one of the greatest stock markets in U.S. history from 1990 to 2000, investors in the S&P 500 earned an average return of only 3.83 percent from 1990 to 2010. That was without the four biggest economies in turmoil at the same time.” (Van Mueller)

What I stress to you, readers and clients, is that this DOESN’T have to happen to you! I can show you strategies to make absolutely sure you are protected from market volatility. If you’ve lost money in the past, wouldn’t it be nice for that  to never happen again? Secure your nest egg, plan for your future, and do it today. If you haven’t started a plan yet- DO SO. Procrastination makes it that much harder to keep up because time works against you. If you have a plan, make sure you are allocated well, so you can be poised to take advantage of any market situation, not just if things go well.

Visit Retirement Comparison-  Post Comments-  Request a Free Portfolio Review(Mention portfolio review in Additional comments), OR -Feel Free to call with questions! God Bless!

What do you want remembered? How do you want to be remembered?

I was giving this some thought yesterday, and I received the inspiration for this blog.  3 years ago yesterday, my mother went to be with the Lord. I was thinking through and reflecting on just what I gained from her, her life, her teaching, and her values. I know an infinite amount of value was communicated to me both verbally and through observation. Some of the most phenomenal things I have are the written and video talks, where she is sharing her views, beliefs, and mindsets. I have tangible communication that I can review and pass along. I know what was given to me has influenced me in an incredibly positive way, and I look forward to passing that along to the next generation.

When I think back of why I remember her, it isn’t money, although she did save and invest so she could leave us some, it is because of the intellectual property she managed to instill in me (somehow through the grace of God).   I know the tangible communications I have from her will be passed on, her values will be preserved, and her vision will be carried on. That is a Legacy, a legacy that will influence for generations to come!

I share this story, so that I can help you start your ‘family legacy’ today. I have a very insignificant amount of recorded information compared to what I would like to have.  What I do with families is show them ways to maintain and grow family strength. My goal is when each person passes away, to keep as much money AND intellectual property in the family as possible. That is what families that have been consistently strong over the years have learned to do. The Rothschild, the Hilton, the Kennedy familes- All know how to maintain family wealth. TRUE wealth  includes your monetary estate, but the  monetary section is far overshadowed by the intellectual property, life experiences, and relationships that have brought you to where you are today.

My passion is to show you a way to keep all things possible in the family.

What a ‘Legacy Plan’ looks like-

• An individual consultation geared towards finding what you truly want preserved and transfered to the next generation.

• Plans will then be lined out that will allow you to keep complete control over your money until your dying breath, but then keep as much of that money as possible IN THE FAMILY.
• You will create a personal family legacy sheet- A well thought out list detailing, what, if you could transfer anything, you would want your kids to value, receive, obtain, or retain.
• An advanced team will be brought in to take care of any legal issues. The use of trusts, wills, and foundations is crucial to maintaining family strength. Too many families are divided due to assets going through probate.
• You will have an annual review after setting up your plan. You will continue to add to your legal documents and your family legacy documents.

Don’t let the time to preserve your  ‘assets’ pass by. It burdens me to see how few families know or take advantage of the strategies of how to create and maintain family strength.

Feel free to call me directly and visit about any questions comments or concerns: Ask for Sam @ 405.293.EASY

Or use any of the links above to Compare , Request contact, or a request a quote.

I have two links for you to watch as part of this week’s blog.

Click Here

http://www.youtube.com/user/LIFEfoundation?blend=24&ob=5#p/u/0/ZKHftmGWoEM

Click Here

http://www.youtube.com/user/LIFEfoundation?blend=24&ob=5#p/u/9/edlIVr9DYfI

I came across this website  a few months back that made a huge impact on me mentally and emotionally. This group is a non-profit organization, and they publish thought provoking videos and life stories as a tool to help you plan and prepare for ANY future. I know my goal is to help people prepare for the worst, and plan/ expect the best.  Many of my clients have expressed to my their thoughts on why life insurance is so important to them. I think I can sum it up in a short exercise. Take a piece of paper and write the names of two family friends, relatives, or acquaintances who would be financially able AND willing to do to give your family and kids everything you plan to do and give to them. That is the purpose of life insurance at it’s purest form. I don’t help people manage risk. I help you manage the consequences when risk turns into tragedy.

Both these videos are powerful and inspirational. I challenge you: If you haven’t taken the time to protect that which is important to you, DO SO TODAY. Don’t gamble on the future, and definitely, don’t bet your life.

Request a call today, and we will set up a time for a face to face sit down appointment. We will go over you plans and goals,  make sure you are prepared for the worst, and help you plan to leave a family legacy for generations to come.

Well, more than one year, but hopefully for those of you who wondered where I disappeared this past 14 months, you can now understand. Here is my first of what will soon be my tradition of ‘annual update’ posts. Also, I felt like it was time to update everyone at least to give some justification to my lack of posts these past few months.  That said-

-Overview

First let me say, God has been good to me!  He has consistently provided for me, and has allowed me to participate in some amazing opportunities. If I were to list ALL the ways I have been blessed, I would run out of room, but I will attempt to highlight some of the specific areas. As I look back on the past year since I got into the business, I have gained so much insight it is incredible. I cannot thank enough, those who have chosen to invest in me.

-Accomplishments

I have had the PRIVELEGE of servicing over 150 clients, writing nearly 10 million in death benefit,  a few Long Term Care and Disability along the way, as well as some group and personal health insurance.  I have had the privilege of showing so many people the strategies that allow you to stay in complete control of their money, while still keeping as much as possible when you pass away, in the family. I often tell people, I won’t tell you how to MAKE the money, but I WILL tell you how to PRESERVE your money. Principle guaranteed investments far outshine their riskier counterparts, and definitely outshine the CD/Bond environment.

Blessings-

Sometimes it’s the little things… When the storms hit, I had 5 of my clients call me the next day to make sure I was ok. That moved me and let me know- I wasn’t just ‘the insurance guy’. God knows how to encourage me in small ways each and every day. I recently had a client call me just to let me know she had thought about me and wanted me to have a great rest of the week. I had two of my favorite clients pray for me after we had lined out their  retirement plan. Yes, they prayed for me, not for their money. J I have had gift baskets delivered, cards mailed, and text messages. I can’t help but stay happy and enthused about my work! God is so good.

My life right now-

I am so grateful to have the opportunity to do what I am doing now. God has given me certain gifts and nuances that make me who I am. I love deal shopping, getting the best, teaching, explaining, numbers, sharing, fellowship, sharing my faith and challenges.  Through my work I get to do all of the above. As an independent broker, I can fulfill my love of getting the best by doing so every day for my clients. I have the ability to write for any company, so I have the ability to shop through WITHOUT bias and pick out the absolute best plan for my clients(the best is not always the cheapest I might add). I get to teach, explain, and fellowship every day. God has given me a gift for communication, and I get to use that every day as I listen to stories, understand needs, and provide solutions. Numbers are a part of my life now, and I love it. There is always a challenge to be overcome, new strategies to improve the ability to preserve wealth, tax laws that change, ect ect- and I love that constant stream of daily fresh challenges. I commonly am helping people plan for ‘what happens to you after you die?’ My faith is such a large part of who I am, it just can’t help but come up in conversation at that point. God has been so good to allow me the joy of sharing him!

-Closing

If you are still with me after reading all of that, I commend you. If you are already one of my clients, I thank you for your support and loyalty! If you are one of my dear friends who is wondering why I have not taken the time to talk to you about your insurance, it’s simply because I NEVER want anyone to be offended or feel obligated to do business with me. If you are reading this, and would like to have more contact with me, whether it is to review what you have, obtain more, or simply to gain a better understanding of myself and my firms services so you can pass me along, don’t hesitate to put yourself in contact with me.  Many blessings have come my way, if I can in anyway bless you or touch your life in a positive way, I eagerly await the chance.

This quote sums up exactly how I feel, and some of what motivates me on a daily basis.

THANK YOU TO ALL WHO HAVE INVESTED IN ME ACTIVELY AND OVER THE YEARS.

“Many times a day I realize how much
my own inner and outer life is built
on the labors of other men, both living
and dead, and how earnestly I must exert
myself in order to give and return as
much as I have received.”
–Albert Einstein

God Bless!

What worries me:

1. This article is a year old.
2. Nothing has changed(for the better).
3. Nobody seems as  frustrated with this as they should be.

Every individual should know the strategies of how to accomplish the same things a bank does. Learn how to PROTECT, GROW, and LEVERAGE your money, how to become  your own banker, and how to preserve your assets. If you don’t do this for yourself and your family, no one will. No one plans to fail, many people fail to plan. Don’t let that be you.

Link at the bottom of the page-

The latest quarterly reports from the big Wall Street banks revealed a startling fact: None of the big four banks had a single day in the quarter in which they lost money trading.

For the 63 straight trading days in Q1, in other words, Goldman Sachs, JP Morgan, Bank of America, and Citigroup made money trading for their own accounts.

Trading, of course, is supposed to be a risky business: You win some, you lose some. That’s how traders justify their gargantuan bonuses–their jobs are so risky that they deserve to be paid millions for protecting their firms’ precious capital. (Of course, the only thing that happens if traders fail to protect capital is that taxpayers bail out the bank and the traders are paid huge “retention” bonuses to prevent them from leaving to trade somewhere else, but that’s a different story).

But these days, trading isn’t risky at all. In fact, it’s safer than walking down the street.

Why?

Because the US government is lending money to the big banks at near-zero interest rates. And the banks are then turning around and lending that money back to the US government at 3%-4% interest rates, making 3%+ on the spread. What’s more, the banks are leveraging this trade, borrowing at least $10 for every $1 of equity capital they have, to increase the size of their bets.  Which means the banks can turn relatively small amounts of equity into huge profits–by borrowing from the taxpayer and then lending back to the taxpayer.

Why is the US government still lending banks money at near-zero interest rates? Ostensibly, for the same reason that the government bailed out the banks in the first place: So the banks will lend money to small businesses, big businesses, and other participants in the “real economy.”

But the banks aren’t lending money to the real economy: Private sector lending has fallen off a cliff.

And one reason private sector lending has fallen off a cliff is that lending money to the private sector is risky. Lending money to the government, meanwhile, is nearly risk-free. So the banks are just lending money back to the government (by scarfing up US Treasuries), collecting a nearly risk-free 3% spread, and then leveraging up this bet 10-15 times.

THAT’s how the big banks made money 63 days in a row. Importantly, doing this required no special genius: If you had the good fortune of working at a big bank, you would be making money every day, too.  And then you’d get to take half of that money home as a bonus!

No wonder everyone wants to work on Wall Street.

The government’s zero-interest-rate policy, in other words, is the biggest Wall Street subsidy yet. So far, it has done little to increase the supply of credit in the real economy. But it has hosed responsible people who lived within their means and are now earning next-to-nothing on their savings. It has also allowed the big Wall Street banks to print money to offset all the dumb bets that brought the financial system to the brink of collapse two years ago. And it has fattened Wall Street bonus pools to record levels again.

http://finance.yahoo.com/tech-ticker/huge-ongoing-wall-street-subsidy-allows-banks-to-coin-money-every-day-at-savers%27-expense-485282.html?tickers=xlf,^dji,^gspc,gs,jpm,bac,c