Big Banks. Fail.

Starting today four on the nation’s biggest banks stopped accepting IOUs from the cash-strapped state of California.

Check the list:

  • Bank of America,
  • JPMorgan Chase & Co.,
  • Wells Fargo & Co., and
  • Union Bank of California.

Recognize some of the names? Yep, they’re many of the same ones that you and I bailed out with federal loans, guarantees, and forgiveness.

Now I don’t much like seeing states issuing IOUs while they sort out their political goings on. And Professor Natelson ponders whether they might even be unconstitutional.

But watching big banks penalize small business and consumer recipients of IOUs not only seems like playing politics with the helpless citizens caught in the crosshairs, but it strikes me as exceedingly bad business. Watch all those customers head over to the local credit union or community bank. And never come back.

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