There is or was $6.6 trillion on deposit at US banks, but over $2 trillion of these are UNINSURED — over the FDIC limits.As I understand it, this is already happening. That's why T-bill yields fell to zero; people and businesses were moving their money from bank accounts to Treasury bills. I've heard that's part of what caused Wachovia to be taken over—money was flowing out of the bank rapidly.
Eventually the sheeple who own that $2 trillion will WAKE UP and start pulling it out of the banks, if they aren't doing that already today. And so will people and businesses with deposits that are even FDIC insured, as they trust their mattress more than their bank.
So, get ready for Congress to change the FDIC limit to $1 million or more — or all of it, putting the taxpayer again on the hook for trillions.
Otherwise the real bank run starts right now. And unlike 1933, there won't be lines outside banks. Bank runs today are done right here, on the internet, where they can't be seen but they can sure be felt.
If that online bank run is already underway, which based on the near 0% short term t-bill rate it is, and Congress doesn't raise FDIC, then get REAL worried about the banks closing, by order of the government. Get worried about not having access to your money.
The Emergency Economic Recovery Act of 2008 would temporarily raise FDIC insurance to $250,000.
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HEART ATTACKS & BANK HOLIDAYS
ReplyDeleteThis from a friend in Atlanta with strong banking connections: “Reliable word that Bank of America branch managers just received a letter or memo from the USFed instructing them to perhaps be ready for a one-week universal shut-down of the banking system, including access to checking accounts, savings accounts and credit cards. Reliable word has it that BofA bank branches received a shipment of signs last week, reading “WE'RE SORRY, BUT DUE TO CIRCUMSTANCES BEYOND OUR CONTROL, WE CANNOT BE OPEN AT THIS TIME.”
Sorry to be spammish but please consider my proposal for a November Surprise:
ReplyDeleteIn between the current fleecing operation and the next one is one important little event: The November Elections. I have already seen a few starter plans out there to rally support for opponents of anyone that voted for this bill. This is a good start. Special attention should be paid to the cowardly vote changers that changed their minds when presented with cash handouts. In the next few days I am sure a solid, well organized plan will take shape and I will be donating money towards this goal. I strongly suggest you do as well.
We must do this, and more. What's more is that a message must be sent here. No more bailouts. No more mismanagement of the economy and national finances. No more giving the voters the middle finger with no accountability. NO MORE.
If you are reading this blog and others like it I feel safe in assuming you have a good head on your shoulders. I will further state that I think most, if not all, are solid citizens just trying to do their best. Whatever your political leanings I would think you have strong principals and you do not like to compromise them. I understand this and I respect that immensely.
I am going to ask you to compromise it nonetheless.
What I want you to do is to identify all incumbents that are on your ballot for November. Then I want you to vote against every single one.(You may elect to keep any official that voted NO to the bailout.)
Now I understand that for many the thought of voting for a republican makes you ill. You may think Roe vs. Wade will be overturned the first morning of the new congress or that we will invade Canada or whatever. Get over it. You can always vote the next time for a democrat. This issue is the most important thing and all that other stuff can wait.
I get it that the thought of voting for a Democrat may make you want to take a shower. You may think the gestapo will be at your door the first morning of the new congress to take your guns and your gold. You might think that we will be forced to marry a gay person even if we are not gay or whatever. Get over it. You can always vote for a republican the next time.
I can guarantee that if a boatload of incumbent get sent down the river, the new congress is going to be especially keen on listening to their voters. Very keen. You may even find that with a new attention to the voices of regular people, the differences between the right and the left for ordinary folks may not be so large.
getyourselfconnected,
ReplyDeleteThat's not spammish. Would it be OK with you if I reprint your comment as a full blog post?
I pulled all money from my bank accts. 6 months ago - now I only got one dollar left in mma and 6 cents on free checking :)--------- was'n I ahead of times ?
ReplyDelete