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Utility vs. For Profit

Power grid-utilities vs profit
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Power grid-utilities vs profit(Excerpt from MarketLogics 5/5/15)

It is amazing how mortgage banking is so entrepreneurial, compared to the lack of innovation from the other industries that are government-regulated utilities.

Think about airlines. How many think that the airline industry is making too much money today? It was a utility. It became a for-profit business that could not control costs until after a few rounds of industry-wide bankruptcies. Few airlines escaped and remained in business. Where would the airline industry be today had it remained, in essence, a utility?

While we are thinking about utilities, what about the electric, water and gas utilities? Do you think that innovation come from them? Of course not, instead they provide little profit, little innovation, and yet huge systemic risk because they are government sponsored utilities. The power grid is the Achilles’ heel of the United States.

Think about the telephone utility that was a monopoly that no longer exists. In comparison, the voice communication commodity is doing quite well. Why? Because of the profit motive.

Now think CFPB. Is it really consumer protection or is it protection of the new status quo?

Les Parker

About the Author

Les Parker

Les Parker, CMB, (Guest Blogger) is currently managing director of Transformational Mortgage Solutions and served previously as Senior Vice President of Industry Relations and Consulting at LoanLogics He understands the relationship between risk management and quality assurance, which is the foundation of the new highly regulated secondary market. Prior to LoanLogics, Mr. Parker was president of PARKER & COMPANY which was founded in February 1994 and was acquired by LoanLogics in September, 2013. For over thirty years, Parker has been active in ministry and is currently the chaplain for the Fellowship of Real Estate Executives, FREE. Parker has written numerous articles and has made various presentations on an array of mortgage banking topics for organizations including Fannie Mae, Mortgage Bankers Association, National Mortgage News, Chicago Board of Trade, New England Mortgage Banking Conference, Appraisal Institute and regional thrift and banking conferences.
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Les Parker

About Les Parker

Les Parker, CMB, (Guest Blogger) is currently managing director of Transformational Mortgage Solutions and served previously as Senior Vice President of Industry Relations and Consulting at LoanLogics He understands the relationship between risk management and quality assurance, which is the foundation of the new highly regulated secondary market. Prior to LoanLogics, Mr. Parker was president of PARKER & COMPANY which was founded in February 1994 and was acquired by LoanLogics in September, 2013. For over thirty years, Parker has been active in ministry and is currently the chaplain for the Fellowship of Real Estate Executives, FREE. Parker has written numerous articles and has made various presentations on an array of mortgage banking topics for organizations including Fannie Mae, Mortgage Bankers Association, National Mortgage News, Chicago Board of Trade, New England Mortgage Banking Conference, Appraisal Institute and regional thrift and banking conferences.
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