THIS IS NOT FINANCIAL ADVICE, PLEASE DO YOUR OWN RESEARCH
I’m going to say a few things in this post that will be a little difficult to grasp but that is the reality of life. As black people, we view banking as any other entity. We view is as a white establishment, we see it as the banks are always against us because we are black. While that may be true on one hand, it may not be the whole truth. Banks do indeed have a very racist history, but as someone rightfully said history already happened there is nothing that can be done about it, the future, however, is unstable.
In Europe for example, there were two individuals by the name of David and Alexander Barclay, (brothers) who started Barclay’s bank, a bank that heavily invested in the slave trade. They extended credit lines to slave merchants. Bank of England was no exception and so on and so forth. The truth is slavery was very lucrative, and we cannot fault banks for being involved in something lucrative, after all, it benefitted their bottom line, that’s like saying banks shouldn’t be involved in religion, church, never mind that church is a very lucrative business. Banks go where the money is. Everyone can see why banks can be hated by black people.
As I already stated history is history, it can be very painful but what have we learned from it? Well for starters we need to know that money starts from a bank and ends up in a bank, no matter how often it is passed around. therefore ownership of the bank is critical when it comes to creating capital. What banks do ( at least back in the day) is take deposits and then create loans from those deposits to fund businesses etc. Today ( at least the last time I checked, only 42 financial institutions remain for black people of which half of them are banks and the other half are credit unions.
Let me tell you how important banking is Jumping back into history again, Not only did president Lincoln free slaves, he established a bank called Freedman Savings Bank to help freed black slaves to build some wealth and capital. Did you know that Frederick Douglas was the director of the DC branch of this bank? he actually invested his own money in this bank. Though the bank was short-lived, he knew enough to know that the development of black wealth lies in banking, as it has for white wealth. There was another bank that was started called True reformers bank and was founded by William Washington Brownstone, a former slave and a union army officer, he also founded an organization called Grand fountain united order of true reformers fraternal organization. These men knew how important banking was and still is and how it is critical in creating wealth.
We like to talk about Tulsa Oklahoma, but how wealth was made in Tulsa is NEVER talked about. Our leaders like to keep the conversation of what “they” took from “us”.
People like to talk about how many hands the dollar touches before it leaves the black community, but they forget one big thing, how does that dollar stay in the community? if we don’t have our own banks, the dollar can circulate in the community a million times, it will always end up in a white bank, remember money starts from a bank and ends up in a bank .if we put it in a white bank it still leaves the community. Which means it doesn’t help anyone in the community it came from. A good example is a church, most black churches put their money in white banks, it is the biggest form of wealth transfer the funny thing is that this happens every Sunday.
As of now, we have a trillion dollars in spending power yet there are few banks, and the number keeps decreasing every year. Our leaders are still telling us to start businesses, without our own banks we cannot create capital, without capital we cannot engage in any economic activity like lending money to start-ups.
Most people in their neighborhoods don’t ask their politicians about banking in their area, how do we create capital and wealth in that area, if there are no banks????? This is how much we are far removed from so-called investments and it has become like a catchphrase for us so we fall for every lie that anyone tells us. If we have the basics of accounting and banking at our fingertips, we wouldn’t fall for “sweet” Promises. I would like to end this post by looking at some interesting numbers. According to NCUA,
There are 34 Hispanic American Banks holding $104 billion in Assets, there are 104 Hispanic American Credit Unions holding $14 Billion in assets.
There are 73 Asian American Banks holding $120 Billion in assets and 54 Asian American credit unions. There are 42 African American Financial Institutions, holding just a little over $5 Billion in Assets, out of these 42 exactly half are credit unions, which means we have only 21 banks and 21 Credit unions. If we are serious about investing, these numbers should mean something to us.
