You Work Hard, You Save Regularly BUT What Guarantees Your Money is Safe?

reply to post by Justin Oldham

Wealth hoarding would be useless in an inflationary spiral. It would be hard to wait out the hard times you lives through. Things change, f you can see the downturn coming. then, you've got a shot at hoarding enough assets to help ameliorate/lessen your discomfort.

If we do have a real breakdown in our society, a massive failure of the banking system, and inflation out of sight, then I can see Black Shirts - Mussolini - or Brown Shirts - Hitler, over here.

If we get “stuck” between elections as happened in 1928-1932, then we may not survive as a civil society. Remember Hoover was sworn in on March 4, 1929. On Black Thursday October 24, 1929, the market fell, but it was the catastrophic downturn of Black Monday and Tuesday October 28 - 29, 1929 that dealt the death knell to our economy. Hoover had been in office barely 7 months.

But for the now suffering public, it meant nearly FOUR YEARS before any real political relief could come. 4 years! That is TOO long to wait! We will not do that again.

Hoover was philosophically incapable of visualizing the Federal government as an agency for helping the country. Reagan and Bush43 are in the same mold. It is very hard if not impossible for a honest ANTI government man to utilize the potential of the government for the people's good. They see it as OK to help commerce but NOT to help people. Odd?

The Dems regained control of Congress in the 1930 election but they faced vetoes from Hoover. The first TVA Act was vetoed. I recall reading in the US Code Annual volume for the 1932-1933 years, that Congress had passed two bills, one to feed cattle on the Great Plains and the other to enlarge the Soup Kitchens of that era. Hoover signed the bill to feed cows and horses into law but he VETOED the bill to feed humans explaining “It is likely to destroy their self reliance.” If you get a chance, any county law library will have that volume to read.

We have experienced a similar bad outcome today. The Dems gained control of Congress for the first time after Newt Gingrich put the final touches on the Reagan Revolution. Yet, from November 2006 until January 2009, we are HELPLESS. That is longer than TWO years.

We need a constitutional convention ASAP.

[edit on 6/24/2008 by donwhite]

black Shirts and the SA are just the sort of cadres I have warned about in the past. You are quite right to suggest they might be in our future. If this economic downturn becomes too severe, you will see those cadres being welcomed with open arms.

reply to post by donwhite


I need to point out to the reader that I was referring to the Reserve Bank of New Zealand not the Federal Reserve . I have no beef with the Federal Reserve or the Reserve Bank . For more info on where I was coming from see this post .

IMO most of the dislike of the Fed I have seen on ATS comes from the anti establishment crowd .

reply to post by xpert11

I need to point out to the reader that I was referring to the Reserve Bank of New Zealand not the Federal Reserve . I have no beef with the Federal Reserve or the Reserve Bank

Geez! It's a good thing I gave you my short answer.

I'm gonna be out of town next week, but I'd like you guys to keep this going. It's a good line of discussion.

[edit on 27-6-2008 by Justin Oldham]

Oil $143; 4,113 KIA - July 1, 2008

reply to post by Justin Oldham


One simple rule that could have been applied 6 months ago to our advantage by the CFTC* would be the polar opposite of the NYSE** rule to slow or stop a sell-off. Anytime the NYSE drops 500 points on the DJIA*** the exchange closes for the remainder of the day. I suppose the theory is that the rush to “sell” mode was like a panic. It was hoped that if the sellers (and buyers) would step back, take a long look, they would not continue the rush to unload.

The big issue now is will the NYSE fall to the same 7000 level it fell to just after Bush43 inherited a 12,000 DJIA? Whatever kind of economics Bush43 "studied" at Harvard, it is not working. I still believe the John Maynard Keynes economic model is 5 X more accurate (usefull) than Milton Friedman's discredited economic model. The American people will pay a heavy price to have that demonstrated to us again. "If you don't know your history, you are doomed to repeat it."

*Commodity Futures Trading Commission. The REGULATORY body meant to keep the price of our food and energy affordable.

**New York Stock Exchange a/k/a Wall Street

***Dow Jones Industrial Average - Based on 30 carefully selected stocks.

[edit on 7/1/2008 by donwhite]

I note with some interest that gold and silver are on the move. Is anyone watching this? Are you buying? It's possible that we could see a run on silver later in this year. Would it be wise to gather up 30 days worth of operating capitol in silver? I think so.

[edit on 7-7-2008 by Justin Oldham]

Originally posted by donwhite
The other day I heard someone say that in 1990 there were 9 million (American) people in “the market.” A loose term encompassing all the private “investment” markets. The NYSE. Nasdaq. OTC. Stocks. Bonds. Mutual funds. Retirement funds. Private retirement accounts. Add to that what we call HEDGE funds and now the newest, SOVEREIGN WEALTH funds. George W Bush - known to his friends as DUMBYA - tried to add the $3 trillion Social Security Trust funds to that MIX. Fortunately for ALL Americans he failed.

Sigh. OK where do I even start?

How about here. As of this moment, the absolute best return anybody gets from SS ( white males due to thier longer time in the workforce on average) is about 1.5%
Yes thats right, about half of what you could get for simply sticking the exact same contribution in a FDIC insured bank. Also Bush never wanted to, or could add the SS "trust fund" to the mix, since it doesnt exist. There isnt one. All current benefits are paid from current witholdings. In other words the money you pay into SS, does NOT go into a trust fund, it goes directly to those seniors who are retired today.

The speaker went on to say in 2005 there were 96 million Americans in "the market." A 10 fold increase in just 25 years. And I’d wager 99.44% of those GOOD Americans think - hope - believe - trust - that someone, somewhere is "watching over" their money and the money-handlers on whose corporate honesty and personal integrity the security of their retirement depends. But you who read me much at ATS know already what I am about to say:

NOPE, there’s not ONE dam agency assigned the responsibility of keeping your BROKER honest. Or fair. Or reasonable. Or are requiring insurance to cover YOUR loses should your broker or his boss decide to take your money and go off to Costa Rica. Like the swindler Robert Vesco. (He died November 23, 2007 in Cuba at age 72. He stole about $125 million).

OK. Not bad. Your right there isnt one, theres several. Theres Finra (formerly the NASD) theres the SEC. There are state "Blue Sky laws as well as state regulators" And thats just on the stock/mutual fund/annuties side of the business. There are seperate regulatory agencies for futures contracts, forex trades, etc etc.

As to "insurance" its called the Securities Investor Protection Corporation.
SIPC

Now you're techincally right that the SIPC does not protect from fraud in the same way the FDIC does. This is primarily because Banking and investing are two different activities with differeing risk profiles. However, this is also offset by the availabillity of civil law proceedings, including mediation and other options.

But that is the fault of the 96 million savers who think they are investing. There is a big difference. But personal greed, ignorance of the laws and unrealistic hope all work to put their money at risk. What was once called "selling the blue sky" in the 1890s when we had a similar rush to buy anything labeled a bond is here again. Here on ATS there is an ad "34 stocks that doubled." Of course, the ad never tells you about the 68 stocks that HALVED. Remember for every buyer there must be a seller. One guy who thinks his stock has peaked and the other guy who thinks it has further to go.

Not quite correct, for every share sold there is a share bought. But matching orders is illegal.
as to your "one guy" criticism, well thats how markets work. Its also WHY they work.

Oh sure, it is still against the law to steal another’s money. But “stealing” in mutual funds is not easy to prove. Insider trading is rampant - IMO - and who is to say your losses were not just due to the vicissitudes of the market place? After all, for every winner there must perforce be a loser. Or to be blunt: Prove it!

Wow people have to prove they have been defrauded? We dont throw people into jail and size thier assets on the accusation alone? NO!

Mutual funds. Load or no-load. Upside: Been around for years. Downside: The fund managers are paid based on "TRANSACTIONS."

No they arent. They are paid a fee based on the amount of assets under management, and in amny cases the change between the amount under management the last year. Brokers get paid by transaction. Mutual fund manager, hedge fund managers, do not. Now you may be confused by the fact that some fund manager do get paid a fee based on the amount you invest into the fund. And of course they may charge you again when you liquidate you position. But under no circumstances do fund manager get paid based on the number of trades. A fund manager can make 100,000 trades in a single day, and if he doesnt end the day in the black side of the ledger, he hasnt made a cent.

2 years ago the fund managers recommended a buy GM. So they sold their Chrysler stock and bought GM. TWO transactions! Now $4 gasoline in 2008 makes GM look bad. Too many SUVs. SELL GM and BUY Toyota and Honda. TWO more TRANSACTIONS. Shucks, YOU lose but I WIN every time! Aside: I have known one fellow who made a lot in the "market." He had this rule: Buy only good stocks and NEVER sell. After 30 years all his mistakes had fixed themselves.

Again, you seem to be confusing brokers, with fund managers. Big difference.

Sweet Jesus, how do I get one of those manager jobs? What tests must I pass? What must I know? What background vetting do I get? Do I have to agree to take a polygraph every 6 months like the CIA or NSA workers? Do I have to buy a personal BOND? Answer: NONE of the above.

Well to start with a degree in finace preferably a master or a PHd, from a good school. Then you usualy get hired to do scut work for the manager and have to prove yourself by making solid reccomendations. Now if you prove out to be good, and I mean very good becuase if you screw up it impacts the managers income, you might be added to tthe trading team if they have one, where you will work under the fund managers direction in order to leaqrn your trade. You could also be hired on as an analust and work your way up that way, . In addition some people areable to open funds because they have relationships with high networth clients who are willing to seed it with thier own money. In addition most fund managers (virtually all in fact) have thier own personal monies invested in the fund as well. Now granted as a FP, Im am not as familiar with the fund management side of the business, but I do know more than your average layman. I certainly know more than you seem to.

I really hope you are not disappointed when you reach 62 years of age and expect to "chuck it in" for the sunshine and clean beaches of the Virgin Islands and to live life on the easy side. We KNOW how to cure this open gapping sore, this invitation to commit fraud. On a scale never before imagined. But will we?

Its actually pretty easy to avoid fraud. Watch your staements, dont buy based on pressure, and work with people you can trust. In soem cases its not enough, and that is very unfortunate. However the flip side of this is its also pretty rare, and those who are convicted tend to lose damn enar everything.






[edit on 7/7/2008 by Shazam The Unbowed]

[edit on 7/7/2008 by Shazam The Unbowed]

I had a chance encounter with a fellow today who said he was going to buy some gold and some silver. Seems that he is interested in hedging his bets agiasnt what is coming. If we accept tht more than one big name bank will fail by the end of this year, it may be wise to think about WHERE your saving account is.

reply to post by Justin Oldham

I had a chance encounter with a fellow today who said he was going to buy some gold and some silver. Seems that he is interested in hedging his bets agiasnt what is coming. If we accept tht more than one big name bank will fail by the end of this year, it may be wise to think about WHERE your saving account is.

Rest easy Mr Depositor! Way back in 1933 Franklin Roosevelt invented the Federal Deposit Insurance Corporation! FDIC. (Unless Ronnie Reagan cancelled it on the q.t.). Since that day, NOT one insured bank depositor in America has lost ONE penny! None. Zip. Zero. Even the R&Fs who have more money deposited in the bank than the stated limit of insurance have been fully covered 100%. And all that good stuff at NO cost to US taxpayers. Wow! That New Deal was something else!

Shucks, maybe good government ain't as bad as Ronnie and Dumbya say it is after all?


[edit on 7/9/2008 by donwhite]

So far as I know, the FDIC and FSLIC only pay ten cents on the dollar, and they can take up to 99 years to pay. If memory serves, that's been talked about here on ATS many times.

reply to post by Justin Oldham

So far as I know, the FDIC and FSLIC only pay ten cents on the dollar, and they can take up to 99 years to pay. If memory serves, that's been talked about here on ATS many times.

J/O, you are known here as a reliable source of important information. But surely you jest when you say “10 cents on the dollar and 99 years to pay” in the same sentence with FDIC and FSLIC.

Because I assume you meant that dire report as “black humor” I would usually refrain from commenting. But there is a slight risk the casual ATS reader might, in reliance on your impeccable reputation for truth and veracity, go away from here thinking wrongly his Federal government has let him down. Thinking that his money in the insured bank is not as safe as if it was in Fort Knox!

Now let’s agree we are talking only about banks that have joined the FDIC or savings and loans that have joined the FSLIC. In each case there will be a sign posted at the front door. If you see that sign, YOUR MONEY IS SAFE!

Not a penny has ever been lost by an insured depositor. REGARDLESS of the amount on deposit, even in excess of the posted limit. In every case all sums due were paid promptly.

Being a member bank or S&L of the FDIC or the FSLIC was optional. But it was such a wise and fiscally sound step that no one in the financial business would run a bank or S&L and NOT join the FDIC or FSLIC. Member banks and S&Ls were assessed a half-percent of money on deposit held on January 1 of each year, and put into a reserve. When the amount in the reserve reached an actuarially sound level, the assessment was suspended.

NO DEPOSITOR HAS EVER LOST A PENNY IN AN INSURED INSTITUTION SINCE 1933.

[edit on 7/10/2008 by donwhite]

Originally posted by donwhite


NO DEPOSITOR HAS EVER LOST A PENNY IN AN INSURED INSTITUTION SINCE 1933.

[edit on 7/10/2008 by donwhite]

Banking is a risk adverse field. As a result it can be insured with little beureacracy, effort, or downside. Investing is by definition a form of risk taking The two industires are not analagous in this respect, and can not be treated as if they were. This is a very basic concept. Surely you can uderstand this?

reply to post by Shazam The Unbowed


Justin Oldham posted: So far as I know, the FDIC and FSLIC only pay ten cents on the dollar, and they can take up to 99 years to pay. If memory serves, that's been talked about here on ATS many times.

Banking is a risk adverse field. As a result it can be insured with little beureacracy, effort, or downside. Investing is by definition a form of risk taking The two industires are not analagous in this respect, and can not be treated as if they were. This is a very basic concept. Surely you can uderstand this?

I was not comparing investing and banking. As you mentioned, those are two very different institutions. In the case above I was replying to a remark by J/O which was incomplete, IMO.

[edit on 7/11/2008 by donwhite]

I am still trying to get over a bad head cold. Even so, I can't help but notice that the price of oil is moving ever closer to $150 per barrel. I have not had the chance to watch gold and silver. I'm going back to bed after I type this. I'm thinking that more and more Americans are going t obe looking for ways to store/hoard their wealth.

I dont like to use banks and use cash for most things. I am working towards gathering supplies and just stocking up, over the next year or so. Can't hurt. Also, I want to gradually work towards living without money, and doing for myself. I can do without a lot, if it means I will be left alone, and beholden to no one. So I am working towards that goal.

Can yall believe I have never shot a gun? Me and the sis are going to take training classes. I think these kind of things are better than money in the long run. I will spend my money now while the spending is good, on things for a future where I dont need money to live a full life.

Anyway thats what I think. Less reliance on money means less power to those who hold money dear.

I'm getting a lot more u2's on this subject than I used to. Let me post my priority list here, again.

1. Paying off your plastic is never a bad t hing. In good times, or in bad times, you will always benefit from a blank credit card.

2. Work out your expenses, and try to keep 30 days of operating capitoal on hand. that's just enough cash to dowhat you normally do for one month.

3. If you do have an investment portfolio, make sure you are diversified. There are many different schools of thought on this, so be sure to pick the one that works best for you.

4. In the United States, firearms can be purchases from private individuals. Paying wish cash eliminates all paper trails. Just be aware that you risk buying a stolen gun, which can land you in jail IF that weapon was used in a crime.

5. Don't plan on a Bunker Strategy. Never forget that the authorities...and hungry mobs...will be looking for hoarders, when things get very bad.

TODAY'S News: The IndyMac Bank Failed! All depositors up to $100,000 will have full access to their money Monday. Any depositor having more than $100,000 on deposit will receive immediate access to 50% of the excess over $100,000.

The unpaid sums over 150% of the posted limit will be paid when the bank is disposed of by the FDIC. The notice warned that the unpaid 50% of excess deposits may or may not be paid conditioned on the sale of the IndyMac.

But I'm saying, never in the history of the US has the FDIC failed to pay 100% of all the deposited amount. Regardless of the amount. See Foot Note.

reply to post by Justin Oldham

Let me post my priority list here, again.

1. Paying off your plastic is never a bad thing . . a blank credit card.
2. . . try to keep 30 days of operating capitoal on hand . . just enough cash to do what you normally do for one month.
3. . . make sure you are diversified.
4. . . firearms can be purchases from private individuals. Paying wish cash eliminates all paper trails. Just be aware that you risk buying a stolen gun, which can land you in jail IF that weapon was used in a crime.
5. Don't plan on a Bunker Strategy. Never forget that the authorities and hungry mobs will be looking for hoarders, when things get very bad.

Your No. Five makes it everybody's business NOT to permit the Doomsday scenario. The US has IGNORED the NPT - nuclear NON-proliferation Treaty - because it was in what our leaders have perceived is in our interest to let Israel have 20-300 nukes, Pakistan to have up 10 10 nukes and India about the same number. Now, Pakistan is about 9/10th in the hand of PRO al Qaeda folks. If Osama bin Laden A-Bombs W-DC, it is as much our fault as it is his.

Israel has had its nuclear bombs since the early 1970s. It is likely the plutonium came from the US via France to Israel. Too hot for us to ship directly! India and Pakistan have been fighting over Kashmir since 1947. Bush43 just gave India a MEDAL for its ILLEGAL nukes and a pat on the back. I hope the next president will do a better job "protecting" us than a half dozen of his immediate predecessors. The Israeli whistleblower is still in prison. Don't they tell us Israel is the only democracy in the Middle East? Maybe Hamas knows Israel better than we do?


Foot Note. In what appears to be the most expensive bank failure ever in this country, troubled mortgage lender IndyMac Bancorp Inc. operations of the Pasadena, Calif. based thrift once one of the nation's largest home lenders - were shut down at 3 p.m. PDT by the Office of Thrift Supervision and transferred to the Federal Deposit Insurance Corp.

It appears that about 95% of the $19 billion in deposits in the bank are insured, but that leaves $1 billion that was not covered by FDIC guarantees. According to the agency, 10,000 IndyMac customers could lose as much as half of that amount, or $500 million. The agency says the failure will cost the Deposit Insurance Fund between $4 billion and $8 billion, based on preliminary estimates. www.blacknewsweekly.com...

[edit on 7/12/2008 by donwhite]

I heard about this bank failure. Wall Street seems to think there will be more failures of this type and size. Given the limitation on the FDIC's payout, I can't help but wonder who's going to get burned. If my head cold would go away, I'm sure I could say more. (sniffle)