You're familiar with the Christmas Classic "It's a Wonderful Life" starring Jimmy Stewart as George Bailey, the compassionate head of the local Savings and Loan.

Nowhere in financial literature is the concept of a savings and loan explained better than by the writers of this 5-time Oscar-nominated Frank Capra movie.

"You're thinking of this place all wrong. As if I had the money back in a safe. The money's not here." explains Stewart. "Your money's in Joe's house . . .right next to yours. And in the Kennedy house, and Mrs. Macklin's house, and a hundred others. Why, you're lending them the money to build, and then, they're going to pay it back to you as best they can."

Perhaps I shouldn't have quoted that last line, "They're going to pay it back to you as best they can," because "as best they can" isn't what it used to be.

What Happened to IndyMac?

July 11, 2008, California's savings bank IndyMac Bancorp - America's ninth biggest mortgage lender - became the biggest retail bank to crumble under the US mortgage crisis. Regulators shut it down after the markets closed because it was unable to raise the cash needed to make good the almost $900 million of losses it has suffered in the worst housing crisis since the Great Depression, according to the TimesOnline.

It will be reorganized as IndyMac Federal Bank. Meanwhile, the FDIC (federal deposit insurance corporation) is running it - the outfit that insures deposits so you're guaranteed to get back at least what you put in. All of this is complicated by several factors, of which the following list is only a few:

1. There is no handsome Jimmy Stewart character who knows into whose mortgage the money went. The notes have been securitized to investors, split, bundled, and now - after all we know - mortgage loans are now being "resecuritized" (Wall Street's latest buzz word)
2. Money can simply be printed and introduced into circulation, paper backed by nothing, further depressing the value of the dollar, thus requiring more of them (paper dollars) to buy anything. That's called inflation.
3. Any appeal to the Federal Reserve to control this mess or prevent a Great Depression (by whatever white-washed name its handlers choose to call it) must be held in the context of the Feds being neither federal (not a government entity, but an organization of private financiers and not resereved as their interest will always be to earn money for themselves, if not based on the prosperity of the masses, then based on their (our) miseries.

The vision for The Great Mortgage Revolt was for people to rebel against usurious (outrageous to the point of being criminal) mortgage interest rates, to start a grassroots movement of managing their money wisely, paying off debt that should be paid off, with the least interest possible and taking charge of their own finances.

I must emphasize that last sentiment: take charge of their own finances. Pay attention. Don't leave it all to money managers, mutual fund managers, insurance sales people and others who, however honest, must put their own best interests first. I'm not advocating "stuff it under your mattress." Just pay attention.