Banks Prefer Using Bailout Funds to Buy More Banks

The $700 billion bailout/rescue funds were supposed to help banks stay liquid. As a result, they would presumably continue lending money, helping businesses operate and stimulate the economy. Consumers would also benefit because they would keep their jobs and be able to get loans to buy stuff.

Alas, that's not how all the banks see it. According to the Consumerist, Chase talks about using their $25 billion

"as a war chest to buy other banks, and hoard it in case times get tougher."

Of course, if nobody's lending, we haven't solved the problem. This means that either the banks aren't interested in helping, or they don't think the problem is very big and it's just an opportunity to snatch up banks at a bargain. Loans have started to trickle through the system, but the sooner this thing ends the better.

How do you feel about banks hoarding money? Tell us about it in the comments.