Unexpected Money Lesson: Banking “South Park” Style


This article may contain affiliate links. If you use them, thanks! I use the money to run this site - more info

Sound financial advice can come from the most unexpected places.

In this case, South Park, the crude, but biting, cartoon series from the decidedly twisted minds of Matt Parker and Trey Stone delivers today’s money lesson.

A good reminder that wisdom and insight can come from almost any source, if you have the vision to think a little deeper.

Money Lesson 1: It’s Not Your Parent’s Economy

The Federal Reserve and other central banks are “throwing granny under the bus.”

Stan’s dad is trying to teach his son about money the old fashioned way – the way he was taught by his father – put it the bank, and it will grow and reward you for years to come.

That’s old-fashioned thinking, and no longer correct in today’s mismanaged global economy.

When I was knee-high to a Krugerrand, banks paid a decent interest rate, above the actual rate of inflation.  This meant that with sufficient capital you could put your money in the bank, and live off the interest payments with almost no risk of losing your money, and the purchasing power of your savings might not grow, but at least it wouldn’t shrink.

Now, in the evocative words of MarketWatch, the Federal Reserve and other central banks are “throwing granny under the bus.

Interest rates are at historical lows, so depositing your money doesn’t work in today’s zero interest rate (ZIRP) and negative interest rate (NIRP) world.  Especially when you take into account how rapidly inflation is eating into your purchasing power.  While the Fed targets a 3% inflation rate, that’s based on the CPI reported by the BLS, which now ignores trivial little items like gas, education, and food.  Anyone who does any actual shopping, knows the value of your dollar is falling, rapidly.

In fact, interest rates are heading negative, as indicated by a recent Wall Street Journal article showing over $10 trillion dollars in sovereign (government) debt now pays negative interest rates.  Wrap your head around that fact, if you can.  Investors are so eager to buy government debt rather than keep cash, that they will give their money to the government knowing they will get less money back in return.  Again, ignoring the loss in purchasing power caused by inflation.

In this bizarro world, it’s not surprising that the death of the middle class is an ongoing crisis.  The Economic Policy Institute shows stagnant worker wage growth – only 0.2% per year since 1979 while purchasing power is in the same boat according to Pew Research – $2 in 1964 money has the same purchasing power as $20 today.

Taking a look at unemployment, the real unemployment rate (U-6 which includes discouraged and underemployed) is almost 10%, more than twice the “official” rate widely reported in the media.  Incidentally, unemployment from the 2008 financial crisis is the highest it’s been since 1948 according to the BLS, other than the recession of the early 80s.

If that’s not enough to have you sit up and take notice, consider Cyprus.  The only country, so far, which has bailed in their bank.  What does that mean?  The government told the bank to steal your money.  That $150,000 you had deposited in your Bank of Cyprus savings account?  They just stole $50,000 of it, but you can have that other $100K back.  For now.

Disturbing times, to be sure.

What to do?  For cash you have to have in the system, consider an interest bearing account at an online bank.  Personally, I like Ally which will pay you 1% – not much, but better than the 0-0.25% most banks pay these days.  Whatever the bank, make sure it’s FDIC insured and you keep less than the $250K FDIC limit in any one bank.

For investments, consider some alternatives outside the typical markets – physical real estate, peer to peer lending, or private placements or other types of investments open to accredited investors.

Money Lesson #2: Banks Don’t Have Your Best Interests At Heart

“Oops” says it all.  No apologies, no explanation, no repercussions.

“A Bank is a place where they lend you an umbrella in fair weather, and ask for it back when it begins to rain” — Robert Frost

Banks make money off your money.  A lot of money.

At the most basic, fractional reserve banking  means your bank can pay you 0% interest, or thereabouts, on your deposits and then loan almost all of your money to someone else at much higher rates – say 3% for a mortgage, or 23% for a credit card.  In most cases, creating money out of thin air by virtue of shifting electrons in a computer system.

“Making bank” as the saying goes.

Banks being banks, they will push you out of useful accounts into what’s best for them by imposing bank fees, luring you with teaser rates on credit cards, etc.  All the while, reducing customer service to barely tolerable levels.  A recent CNBC survey showed only 23% of consumers were happy with their banks for these very reasons.

Personally, I left the last bank I patronized several years ago when they put a $9/month fee on my “free” checking account.  How rude!

My advice?  Cash in your bank accounts, and join your local credit union.  More customer service, lower fees.

Win, win, win.

Money Lesson #3: Understand Your Investments

Lives get ruined when you surrender common sense under pressure.  Don’t let that be you.

Banks are experts at mumbo jumbo.  We might not understand money market mutual fund or foreign currency account, but we all understand “and it’s gone.”

The intent of central banks’ zero interest rate policies is to drive you to take your savings from a bank account and put it in the stock market or other higher risk investments.

End result – you’re making riskier investments than you’d like, and perhaps even investments you don’t understand.

Don’t let that ROI-seeking pressure drive you to invest in something you don’t understand.  It’s the fastest way to lose your money.

If you need a reminder of how easy it is to be bamboozled, watch The Smartest Guys In the Room for a refresher on Enron and what happens when you get sucked into the hype of the unknown and too-good-to-be-true.

Lives get ruined when you surrender common sense under pressure.  Don’t let that be you.

Study your investments.  Take it slowly.  Invest, but only when you understand where you’re putting your money, why, and the worst possible scenarios.

Readers: What money lesson did you learn from this video?  Did I miss a lesson?  Have a money lesson you’ve learned from an unexpected source?  Leave a comment below!

Video clip from the South Park episode Margaritaville; season 13 episode 3 from Comedy Central.


  1. That’s a great video clip and reflects what I’ve been experiencing with my broker over the last few years. In fact, I just today wrote an article about firing my financial advisor because while I was losing money in international mutual funds, he agreed that I was over weighted (based on his firm’s recommendation), but he essentially couldn’t do anything about it.

    Great article.

    • I have to admit I was surprised when I first saw this clip.

      Knowing South Park, you just don’t expect financial wisdom to be served up amongst the ribald humor. Just goes to show, an inquisitive mind can find insight in the most trivial situation.

  2. Having worked in banking for more than a decade, I learned that a bank is merely a business and nothing more. The most difficult part of my job was after being licensed to sell mutual funds and stocks, I was highly pressured to sell what is known as proprietary bank instruments rather than anything else. Those bank products were most profitable to the bank and not the consumer. Even though I had taken a pledge (when licensed) to work in the best interest of my customer, in order to keep my job I had to violate that pledge or leave. Eventually, I left. Your post is right on the money, and I mean that literally!
    Gary @ Super Saving Tips recently posted “Don’t Worry, Be Happy”: 4 Big Money Worries I Stopped Worrying AboutMy Profile

    • Occasionally I wonder.

      Am I seeing the world differently because I’ve changed?

      Or is it the world which has changed around me?

      Whatever the cause (and without specifically calling out the recent high profile examples) it’s a shame our public and private institutions have repeatedly abused our trust to the point where it’s difficult to trust anyone or expect them to live up to an ethical standard.

      • I know. It’s always easier to say things were different “back in the day.”

        But the more they change, the more they stay the same!

        How I wish we would get out of this current debt insanity.

  3. Great South Park video. I don’t think I’ve ever seen a bad episode after the first season (which was nothing but juvenile shock humor).

    Now I’m not sure if things work differently over in investment banking, but I have to disagree that banks (or at least branch-level bankers) are out to “push you out of useful accounts” and just do nothing all day but charge you fees. I’d almost say that the opposite is true!

    And no, I will not dispute the idea that the banks want to make revenue from any source they can. They are, after all, a for profit business.

    Back in November, I published an article provocatively entitled “You Morons Must Love Fees!”, in which I told about how customers would turn down anything that was designed to prevent them from being charged excessive bank fees. No that wasn’t a typo. You read that right.

    If a customer qualified for a free savings account that came with free overdraft protection (which would prevent overdraft fees from being charged in case you DID overdraft), the customer would REFUSE it! Even though having only a checking account left them more open to fees, the customer would DEMAND to only have a checking account.

    When I became a licensed banker, I was tasked with selling fixed annuities. For those who don’t know, a fixed annuity is essentially an IRA CD with a higher interest rate, the ability to earn a lifetime guaranteed income, and a guarantee on your principal (for comparison, bank accounts are NOT principal guaranteed; you CAN lose money. Break your CD or keep less than the minimum on your checking account if you don’t believe me). People have money stagnating in savings accounts at less than 0.1% and are actually paying taxes on that negligible interest! But I can sit this person down, run numbers, tell them all the benefits, and definitively show them how buying a fixed annuity with guaranteed return of principal can benefit them personally, and the customer will still refuse. Why? I don’t know. And then they’ll still go and complain about bank rates after they just turned down higher rates.

    Honestly, in my experience, the greatest obstacle to helping customers save and earn money is the customers. I could easily prevent my customers from being charged excessive fees, but my customers stop me from doing that. All the time.

    Anyhoo, that’s enough of my incoherent rambling.

    ARB–Angry Retail Banker
    ARB recently posted The Bank Isn’t Out To Get You PersonallyMy Profile

    • Great to have a view from the trenches, as it were!

      It sounds like a little knowledge can be more dangerous than ignorance in some matters.

    • Doh!

      Thanks, ARB. On the plus side, it looks like Comedy Central has now put this clip on their official website here. I’ll update the post to point to the new location shortly.

  4. It really does help to understand what you’re investing in before buying anything, especially big ticket items like property if you need a mortgage. Just like banks don’t necessarily have your best interest in heart, the same can be said for some financial advisors and real estate agents. Protect your money and don’t let the wool get pulled over your eyes!

    • That’s right. Finding good advisors who you trust is an important part of financial success. The larger the transaction, the more important it is!

  5. “Cash in your bank accounts, and join your local credit union”

    I’ve had a credit union for 10+ years. Their service is soo much better and personalized. And they offer pretty much all the services regular banks do like online banking, check deposit, loans, mobile apps, etc.

    • I know. No one ever told me how good credit unions were, back in the day. I had to do the research and find out for myself. Great service, low fees, and easy to join.

      What’s not to like!

Leave a Reply to SMM Cancel reply

Please enter your comment!
Please enter your name here

CommentLuv badge