Jeremy Hobson: There are reports this morning that Bank of America will cut 3,500 jobs over the next few months. And the bank is working on restructuring plans that will ax several thousand more. We continue our special coverage now “Breakdown: Our Economy One Step At a Time” with our senior business correspondent Bob Moon who is here live. Bob, good morning.

Bob Moon: Good morning.

Hobson: So, why is Bank of America doing this?

Moon: Well I can answer that with a question: when’s the last time you got a loan? Demand for new loans is down, and B of A is like many banks still carrying the burden of those bad home loans on their books, and it’s making it tough to make money. That helps explain why Bank of America shares have lost almost half their value so far this year. And the quickest way to boost the bottom line and attract investors is laying off workers.

I spoke to Christopher Whalen this morning at Institutional Risk Analytics. He says the irony is B of A is in the wrong kind of growth business right now — it’s working through all those bad mortgages.

Christopher Whalen: They’re still hiring in the back office, if you’re talking about people who can work on foreclosed real estate, or deal with legal issues for all the litigation they’re in. They’re hiring.

And Whalen says that’s not the way for a bank to make money, or stay solvent, for that matter. And Jeremy, in explaining the layoffs, BofA CEO Brian Moynihan reportedly sent a memo to senior executives saying the company owes it to customers and shareholders to stay competitive.

Hobson: Marketplace senior business correspondent Bob Moon. Thanks, Bob.

Moon: Thanks.