not wanting to cause a run on your local bank as this WILL lead to a failure, so don't do it, but the head of the fdic has said they will go bust this year. unless they get higher fees from participating banks and thrifts. this is not good news at all. they do have a 30 billion note of credit with the treasury department they can tap into, but keep in mind since it's creation in 1933, they have never ever had to tap into that line of credit!!!!!!!!!!
what does that mean? well it means your deposits (money) is/are gone and unless the federal govt or treasury department prints up new money and injects captial into the fdic....your crap out of luck.
well you will likely get your check....but the question is when. knowing govt, it could take weeks to months to possibly years if a large bank like citigroup or others went down. meanwhile you'll have no money to pay your bills. your employer, if they bank with a large bank that might fail will have no money to pay your paycheck. worse even still, it's likely your employer's payroll account and other accounts are well voer the temporary $250,000 insurance coverage. so unless they have their money in mulitple banks and accounts....and they don'[t as having a big account means leverage with the bank. in the end you may never get paid for the work you did, and your employer won't be around to supply you with a job unless they can line up new credit to cover payroll and expenses. not an easy task since credit sfreeze is what we are all experiencing.
if this happens prepare for mad max world. the federal govt doesn't have enough cash, can't borrow enough, or print enough to stop this kind of catastrophic problem. cross your fingers that these banks can stay afloat. even if you use a little bank...it doesn't mean you are safe.
these are scary times. for the first time since this started i am truly scared.
here's some basic tips on how to protect yourself. first check out your bank at bankrate.com. they have a bank ratings setup that seems to be fairly accurate. imho, anything less than 3 or 4 stars and watch your bank very carefully. next spread your money around in a few banks. i moved some cash into a seperate bank that wasn't tied to mortgage boom nonsense and other high risk bets. i can't recommend it because it's a private bank. there are other choices though like local credit unions, etc. now i'm not saying to move it all, but rather move some for emergency to cover bills, etc in case your bank does fail and you have to wait for your check. govt never moves very fast so it could take months and you will need cash.
second, stock up some cash at your residence. don't be stupid and put all your money under your mattress. if you have a secure safe at your home putting ina couple grand or even a couple hundred won't be a waste if you need it. basically use common sense here. keep as much cash as you think you will need if things go south faster, and as much as you can afford. also make sure your renter's or h/o insurance policy covers the majprioty of the cash you are planning on keeping in case you do get robbed you won't be out a big chunk of hard to replace money. also don't tell anyone what you are doing. in desperate times even close friends and family might be pushed to rob you. bad luck can make a good man or woman turn bad.
lastly, stock up on ammo, fuel, food, and water. i normally wouldn't say this kind of extreme strategy, but i'm starting to think some of these end of the world people might have something. a little end of the world insurance never hurt. just don't over do it.
other people say to stock up on physical gold. i disagree on this for multiple reasons, but i'll list a few. first gold is way over priced right now. it's in it's own bubble driven by panic, not economic reality. if you buy now you'll never get your money back ever. next, even if you got a good deal on gold...and things do collapse. how are you going to turn it into goods and cash? who here would trade scarce food for gold? gold is a luxury, not a necessity. in this market you don't need luxuries you need food, shelter and clothing. the basics. you can't eat gold. if things don't collapse, but it gets much worse...try turning your gold into cash? no local bank is going to hand over cash for gold. the cash for gold places and pawn shops and dealers that set up shop in hotels for weekend buying sessions pay bottom dollar, so in essence you will lose money and would have been better just holding your cash. these gold dealers know people are desperate for money and will take pennies on the dollar cash payouts on that gold's true value. they are looking to make money themselves and you don't make money by paying top dollar. they are targeting desperate people. the only time to invest in gold is when the market is booming and gold prices are way down. you do not start investing in gold when things are bad and the prices are sky high. so don't do it, imho.
damn this is the worst news so far. if the fdic goes bust....watch out.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment