This ought to start the run on banks . . .

Bair Says Insurance Fund Could Be Insolvent This Year

“A large number” of bank failures may occur through 2010 because of “rapidly deteriorating economic conditions,” Bair said in the letter. “Without substantial amounts of additional assessment revenue in the near future, current projections indicate that the fund balance will approach zero or even become negative

Source - Bloomberg

If you want your money, you might just as well take it out now or wait and 'hope' the FDIC can cover you if your bank goes belly up!!

Europe’s banks face a $2 trillion dollar shortage

The BIS said European and British banks have relied on an “unstable” source of funding, borrowing in their local currencies to finance “long positions in US dollars”. Much of this has to be rolled over in short-term debt markets.

Source

How long before that spreads across the 'pond'?

Fed Refuses to Release Bank Data, Insists on Secrecy

In response to Bloomberg’s request, the Fed said the U.S. is facing “an unprecedented crisis” in which “loss in confidence in and between financial institutions can occur with lightning speed and devastating effects.”

Warm and fuzzy feeling . . . . NOPE

FDIC insolvency possible and secrecy behind which banks are failing . . . hmmmmm . . . and we're supposed to feel somewhat 'safe' and believe our savings are secure?

I've just changed banks to 'Mutual of Cigar Box Under Mattress'

Why hoard money if it'll be useless? Buy food, water, lentils, flour, lotsa chocolate bars, the good stuff. That's always worth money.

reply to post by GoalPoster


The FDIC is running out of money due to the amount of banks that fail in 2008 about 25 banks, now this year alone 16 banks already since the year started had fail.

The money to back up the accounts came from the FDIC at the rate that banks are closing, (mostly small banks) they will be running out of funds.

Then the Government will have to back them up so the money keeps flowing.

Still with the trillions of dollar of money already allocated to budget, bail outs and stimulus, we all know that the money is nothing more than worthless paper been printed out with not backing at all.

Just like all the scam done by the AIG and the banking system nothing but a scam.

reply to post by GoalPoster


So much for transparency, but hey the American people are so used to be lie, and screw upon that they will do as they are told.

everything is peachy

I read last fall that one of the reasons they were scurrying to bail out banks is because the FDIC didn't have the funds if a big bank failed.

Also if your bank should happen to fail and the FDIC does have the money you don't get it right away. The article said it takes 6 months to two years to get your money.

I saw this article as well and immediatly had to check with others on here. Boy, isn't this the cats meow...the insurance to back up our money, is running out .
I agree with other posters, save the money in a safe (mounted to the floor boards!) at home!
Also, I came across this seaching on about the FDIC.. did anyone happen to notice that when they increased the FDIC from 100K to 250K lasts until 12 31 2009, the end of this year only.

I'm in a credit union, which is NCUA, back for the government. Do you think this is safer?
Here is the quote and link I found:
FDIC insurance
From the date of enactment of the bill (October 3, 2008) until December 31, 2009, the amount of deposit insurance provided by the FDIC is increased from $100,000 to $250,000.[


en.wikipedia.org...

Just now on C-SPAN
FDIC will not be able to insure funds by years end.
What a great way to get a run started eh?

[edit on 5-3-2009 by imd12c4funn]

Just FYI.

The FDIC is going down.

Don't keep it in a Credit Union either. CUNA is just another name on the same turd.

Credit Unions were never hooked to the Fed. Govt and Reserve Bank, until the last 15 years. They are now not any different than a bank.
They do leveraged loaning just like banks.

In the good old days, they only lended out what was in deposits.

"At the end of January, 2009, excess reserve balances at the Fed stood at $793 billion[174] but less than two weeks later on February 11, total reserve balances had fallen to $603 billion.[175]"

At the rate we are going thru the reserve money, in 6 months there will be nothing left.

Thanks for filling me in on how it's not safe at credit unions. I don't have much there, but it's all I have.. I'm taking it out!

en.wikipedia.org...

reply to post by de9571


I just can't see the government letting the FDIC fail. They will simply print more money. They'll massively drive up inflation, but they will keep it whole. The consequence of it failing would be exponentially more failed banks. Obama does not want to have bank-lines on the news as he's talking about "change"

reply to post by dolphinfan


The optimist in me says the same thing. They are not going to let this fail..
Doesn't the Government have money in the markets and in the banks?
however the cautious non trusting part of me, says, what if, after all the bailouts we have done, it just doesn't work, and it all fails?
I guess this could be a new thread topic, but what if it really did fail, what then? Everyone is broke? or pretty dang close to it. For myself, most of my money is in stocks, ira and 401 accounts. I keep a minimum in the bank for bills and mad money, but hard core savings is all in the markets - which is worth close to nothing now.. so I'm sure 95% of us are in the same boat. Those that are working for now, will be ok.. but what type of paycheck will it be paid in, dollars? well whose to say if it collapsed? Do they really have a back up monetary system in place? I hear about the Amero, but that may be just rumor and speculation. Another country will buy us out? Who? That's scary too!
Ok, my rant is over.. for now Sorry to be of topic.

Edit for typos


[edit on 5-3-2009 by de9571]

reply to post by napayshni57


I'll have to find it again, But the laws that govern the FDIC says they can take up to 99 years to make good on their promise to cover your money.

reply to post by dolphinfan


Do you realize that if the .gov backstops FDIC it will cause an INSTANTANEOUS bond market dislocation?

No more China buying our treasuries, no more debt financing.

It will cause the collapse of the .gov

And I promise you, what will come next you won't want

Originally posted by de9571
"At the end of January, 2009, excess reserve balances at the Fed stood at $793 billion[174] but less than two weeks later on February 11, total reserve balances had fallen to $603 billion.[175]"

That's a hell of a potential bank run. Keep an eye on the excess reserves over the next few weeks; if they continue plummeting, we may be looking at the mother of all "silent" bank runs.

Originally posted by dolphinfan
I just can't see the government letting the FDIC fail. They will simply print more money. They'll massively drive up inflation, but they will keep it whole.

The gov't will almost certainly step in and backstop the FDIC; they have provisions in place to do so already.
Given the wealth destruction just between the housing market and equities, not even counting the myriad other means of money movement, I don't see a way that printing will cause a dangerous level of inflation. They couldn't print fast enough to keep up with the sucking vortex that is our economy right now.

Originally posted by de9571
however the cautious non trusting part of me, says, what if, after all the bailouts we have done, it just doesn't work, and it all fails?
I guess this could be a new thread topic, but what if it really did fail, what then?

If the FDIC were to run out of money and if the government were unwilling or unable to provide the necessary funds to make them whole, then you'd have at least 150 million American citizens penniless, starving, and carrying torches and pitchforks.
If that were to happen, any money one has in a financial institution would be completely lost were that institution to fail. Now, given that government funds are the only way most, if not all, of the big national and regional banks are still in business, it would stand to reason that if the gov't couldn't backstop the FDIC, then they couldn't backstop the banks either. The banks (Citi, BoA, JPM, all the big names everyone knows) would fail in short order - within weeks, tops - and customer accounts would be wiped out with no hope of recovery.

There was no FDIC during the Great Depression. When banks failed, bank customers lost their money forever.

All that said - if there ever came a time that the FDIC were to run out of money and didn't get a backstop from the gov't, we'd have much bigger problems to worry about than the $5000 or whatever in one's savings account. We'd be looking at the collapse of America, because it would mean we, as a nation, were out of money. Bankrupt. Kaput.

Originally posted by Mercenary2007
I'll have to find it again, But the laws that govern the FDIC says they can take up to 99 years to make good on their promise to cover your money.

Not true

Originally posted by redhatty
reply to post by dolphinfan

 

Do you realize that if the .gov backstops FDIC it will cause an INSTANTANEOUS bond market dislocation?

No more China buying our treasuries, no more debt financing.

It will cause the collapse of the .gov

And I promise you, what will come next you won't want

No it wont.. we wouldn't be the first to do it either.. Ireland for example now insures directly through their federal government insurance on ALL deposits (not just a measly 100-250k)

Backstopping or simply filling the reserves of the FDIC would show to light the severity of our situation, but would be considered one of the few "smart" moves by the Government.

Originally posted by Rockpuck
No it wont.. we wouldn't be the first to do it either.. Ireland for example now insures directly through their federal government insurance on ALL deposits (not just a measly 100-250k)

Backstopping or simply filling the reserves of the FDIC would show to light the severity of our situation, but would be considered one of the few "smart" moves by the Government.

Have you paid attention to the news from Ireland? The cost of backstopping their banks is TWICE the GDP of the country. Time has an article on Ireland from yesterday.

They stopped a run on the banks, but they are still close to failing anyway.

We would be in the same boat.

What do you think the .gov can use to backstop or fill the FDIC? Do you really think China will buy more Treasuries if we make that move? Or do you expect Bernanke's printing press to do the job and cause a collapse of the USD?

A smart move by the .gov would be to follow the laws already on the books and prosecute the fraudsters.

But no, they'd rather sweep the fraud under the rug and continue to pump $$ we don't have into the big banks that are insolvent.

It can not and will not go on forever

The government will just print more money to ensure that the deposits are made whole. The fact that what you are getting insured is worth way less than what it was when it went in is not their concern. We all suffer, but its all about the headlines and most folks don't really understand what inflation means to them anyway.

If the FDIC were to fail that would mean millions of folks with NO money, none. The social unrest would be such that they can not allow that to happen. Every city in the country would be a war zone. They will not allow that to happen. The dude has been in office for less than a quarter. The market has dropped 1/4 since he got the job. Within a year of his getting elected he will not allow (nor should he) massive civil unrest. At this stage of the game it is all about politics, no economics. The FDIC will not be allowed to fail (at least I hope I'm right).

Might go out and get myself a nice safe to hedge my bet though.

That they are Red, but in securing the deposits, they saved their own depositors and stole depositors from Britain and France among other nations.

Quite simply, securing the deposits or not, if the major banks failed, the cds obligations would crash the entire system world wide (hence AIG being bailed out once again) and your money won't be worth anything anyways.

But if you honestly believe the Fed would let a Federal Corporation (state owned) to go bankrupt, committing among other things complete political suicide, then you don't understand American politics.

FDIC will never run out of money.