That's just great. So we have three choices: A: Keep on going like we are and let the FDIC fail, leading to bank runs B: Raise fees on banks, which makes banks more likely to fail, which leads to the FDIC failing, which leads to bank runs C: Drop FDIC insurance on the weak banks So it's probably not a good idea to have money in a bank that is a penny stock, depending on who the government picks to bail out.
Start picking out the smaller, local/regional banks that are in good shape...and especially credit unions. That way if the FDIC fails, you're money at least is still relatively safe.
I think we have about a 75% probability of at least one bank run this year (nationwide run on multiple major banks). :eek: FDIC could NEVER handle a run like that......so it would be even more "print money" time. :eek: This of course would then bring in a FED directed reactionary forced "banking holiday" of 3 to 7 days......WHAT FUN! :eek: No ATM's.....No Debit Card/Credit Card transactions.....No bank withdrawals.....No ACH.....No nothing! If you did not have cash on hand when this type of event took place you would be &^^$%#$$%%^&^!!! :eek:
You guys dont get it, the FDIC could be a recipient for TARP funds. It would be recapitalized with a stroke of a pen, I have no doubt that if problems were to happen Geithner would drop another $100b to the FDIC
BTW, 100 billion will in no way cover a nationwide bank run......not even close. www.youtube.com/watch?v=-xKPcyvlfnc&feature=related http://www.infowars.com/rep-kanjorski-550-billion-disappeared-in-electronic-run-on-the-banks/
CNBC's Maria Bartiromo interviewed BOA Ken Lewis in Sept 08 and here is Lewis' startling back of the envelope assessment. "BARTIROMO: SO RIGHT NOW WE HAVE, WHAT, 9,000 BANKS? 9,000 BANKS IN THIS COUNTRY.WHAT WILL YOUR PREDICTION BE AS FAR AS HOW MANY THERE ARE IN THE NEXT FIVE YEARS? LEWIS: GOSH, I HAVEN'T THOUGHT ABOUTTHAT. MAYBE HALF. " Source: http://www.cnbc.com/id/26728058/
And we should listen to Lewis why? I agree that he's sorta the expert, but he has since demonstrated some significant flaws in his analytical and decision-making capabilties. As a result I try not to attach too much weight to his opinions and actions.