News Releases 2008

LETU Banking Crisis Conference Attracts Crowd

Fri, Nov 14 2008

LeTourneau University School of Business students shared their insights on the current banking crisis Friday morning during the opening session of a day-long conference. 
The students presented a tag-team Powerpoint presentation that explained what mortgage-backed securities are, how bond ratings affect lending, what prime and subprime loans are, the role of Fannie Mae and Freddie Mac in the current financial crisis as well as how the crisis began. Business students presenting included Zac Majors, Rachel Kalkan,  Ben Luckert, Juan Castro Jr., Esther Castro and Lindsey Blackwell.  The students' presentation framed many of the presentations that followed.
About 50 attended the event, which included presentations from local bankers and scholars.
Four local bankers presented a roundtable discussion on how the East Texas economy is affected by the current economic situation affecting the nation.  The bankers included Kelly Stretcher of First National Bank of Gilmer, Mike Fitzhugh of Franklin Bank, now Prosperity Bank; Brad Tidwell of Citizens National Bank and Steve Reese of Community Bank in Longview.   The consensus among the bankers was that Longview and the East Texas area are faring better than other parts of the nation and that local banks have money to lend.
Keynote speaker, Dr. Terry Smith, president of the Federal Home Loan Bank of Dallas, gave an insightful presentation on volatility in the housing market nationwide. He explained the history of mortgage lending over the past several decades, and how mortgage lending practices have contributed to the crisis of defaulted mortgages and increased foreclosures.
In afternoon sessions, LETU finance student Anna Coley presented the differences in Keynesian and Austrian economics philosophies and how the value of the dollar is affected by the U.S. government printing more paper money that is not backed by a gold standard.  Other university professors and financial planning experts also made educational presentations about money management and the stock market.
The banking conference was organized by LETU finance professor Dr. Juan Castro.  The university's new dean of the School of Business, Dr. Bob Wharton, said this banking conference was the first of many conferences the school plans to host in the semesters ahead.