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Is the US Following the China Model of Nationalization?

Dick Bove, of Rafferty Capital, has made the bold statement that US banks have become nationalized. He sees us headed toward a future not unlike that of China, where the state controls everything from the Oil Companies to what you can search on Google (NASDAQ: GOOG.) He’s basing these attacks on the idea that the Federal Reserve has set a bad precedent by reducing the amount of interest it is paying to banks. He says that action is akin to “invading banks” and that we are robbing banks to pay for infrastructure.

While that is a little extreme, and Mr. Bove could just be looking to stir the pot, it’s worth considering what that means if he’s right. This is especially true if America elects the socialist leaning Bernie Sanders. As Bernie shows by his willingness to let his freak flag fly, hair wise, he might be just crazy enough to nationalize a few things. Or maybe I’ve been reading too many conservative news sites lately. Regardless, if Mr. Bove is even a little bit right, I fear a cloudy economic future for America. Nationalization is not the way to go. China’s murky future and very unstable present is a testament to that. We need to take measures to avoid it at all costs.