Posted on 04/04/2013 6:35:55 AM PDT by dirtboy
The decision of the government in Cyprus to simply take money out of people's bank accounts there sent shock waves around the world. People far removed from that small island nation had to wonder: “Can this happen here?”
The economic repercussions of having people feel that their money is not safe in banks can be catastrophic. Banks are not just warehouses where money can be stored. They are crucial institutions for gathering individually modest amounts of money from millions of people and transferring that money to strangers whom those people would not directly trust...
[snip]
One of the big differences between the United States and Cyprus is that the U.S. government can simply print more money to get out of a financial crisis. But Cyprus cannot print more euros, which are controlled by international institutions.
Does that mean that Americans' money is safe in banks? Yes and no.
The U.S. government is very unlikely to just seize money wholesale from people's bank accounts, as is being done in Cyprus. But does that mean that your life savings are safe?
No. There are more sophisticated ways for governments to take what you have put aside for yourself and use it for whatever the politicians feel like using it for. If they do it slowly but steadily, they can take a big chunk of what you have sacrificed for years to save, before you are even aware, much less alarmed.
That is, in fact, already happening.
When officials of the Federal Reserve System speak in vague and lofty terms about “quantitative easing,” what they are talking about is creating more money out of thin air, as the Federal Reserve is authorized to do — and has been doing in recent years, to the tune of tens of billions of dollars a month.
(Excerpt) Read more at triblive.com ...
Gold and silver — in bullion in a very safe safe at homes (split into multiple locations in case of disaster).
Ask savers, many of them elderly, if they appreciate Bernanke stealing their retirement funds by setting interest at zero. The big banks and Wall St. love it, but old folks, who scrimped and saved and were counting on some interest to make it through their “golden years” have got nothing to show for their efforts.
That is truly generational theft. They could have bought their own medical care instead of now having to fund the Medicare boondoggle for many who didn’t put a dime aside for the future.
If the Democrats take control of Congress in 2015, private retirement funds such as IRAs will be at great risk. The Democrats in 2010 had announced a plan to confiscate these private funds.
You captured my thoughts perfectly. Savers got screwed and will continually do so.
Since FDR times, the silver set has been voting for more government goodies for geezers, and they are getting what they chose. That “free” Medicare stuff won’t matter much when you can’t afford food or pay your property tax bill.
It also has a molding effect on young people.
I grew up in a family that stressed savings, and worked hard as a kid in the ‘70s, when you and your parents were already a bit of chumps if you saved for college. But with the way inflation burned through what I had in the bank, the clear early lesson was any kind of savings was for chumps.
sowell pingy...
My elderly aunt is a perfect example. She was very frugal, saved money all her life and invested it wisely.
In later years she started to live more comfortably on the interest she made on various investments. She had money to travel a bit and enjoy eating out once a week, giving nice cash gifts at Christmas to kids and grandkids and giving to various charities (which she greatly enjoyed doing). Now she depends mostly on SS, lives more frugally (as before when she was younger) and has little money left over to give to her charities. She could cash out her investments and live off that probably until she dies. But doesn’t want to cash out her nest eggs, thinking that interest rates will go up any day now. I don’t think they will ... not in her lifetime anyway.
i’ve been saying this for years.
amazing someone else actually got it
It’s a debtor’s market.
Inflation is a debtor’s friend and that’s what TPTB are counting on since there are more debtors than savers.
Dodd-Frank re-defined depositors as investors or unsecured creditors in banks.
As you well know, depositors have a number of rights, whereas changing the definition of a depositor to mean and investor or unsecured creditor removes 90% of those rights.
http://www.fdic.gov/about/srac/2012/gsifi.pdf
Well that clarifies things now. The whole concept of private ownership and wealth has been “tweaked”. How un-Constitutional of them.
Inflation as Cypress-style confiscation is old news. A far better example, as it is more comparable, and even more foul, is the Obamacare “Medicare tax” of 3.8% on capital gains on profits of home sales, on top of the capital gains tax that applies, if you earn Obama’s magical “rich” salary of $250K.
Please note that this applies to the first dollar of stock profits as well — all “non-wage income”.
As usual, the little reporting of this that exists makes pains to parrot the class-envy line that it really only applies to rich people.
As an example, my Grandpa was one of the six founders of Borg Warner, a company that went on to become huge. His retirement was set at $400 a month, a princly sum in that day and age when you could buy a house for a few thousand.
But by the time he retired, it was not enough to keep him and grandma in groceries. He earned the cash in his retirement account being payed far less than minimum wage, but that money is bubble gum money now because the government printed it away. This is why the 401k retirement system is a scam. Earn your million to live off of by working hard and stashing your money away. It will buy you a loaf of bread some day. The only thing with value when the goverment no longer lives responsibly is tangible goods and property. So the banks want the morgage on everything.
Cause they know their money is crap in a bucket. When the SHTF, they got the deed, you got crap in a bucket.
Agree. I have not forgotten that, and I’m sure the Dems are salivating at all that money they could confiscate if they win the House.
Since FDR times, the silver set has been voting for more government goodies for geezers, and they are getting what they chose. That “free” Medicare stuff won’t matter much when you can’t afford food or pay your property tax bill.”””
Excuse me, friend.
I have paid into medicare from age 15 until age 65. I didn’t have any choice. From age 37 to 65, I was self-employed, so I paid BOTH HALVES.
I am eligible for Medicare now, but I haven’t used a dime of same. I hope I won’t have to. But a percentage of mny GOSS earnings was taken before I saw a paycheck, and in the later years, I had to pay it directly with my tax return-—at double the rate employees pay.
The actuarial tables didn’t allow for all the ‘disable’ scammers who are sucking Social Security & Medicare dry. It certainly didn’t allow for the illegals to have benefits.
If there is any group in the country which will eventually stand up to this theft, it is those over 50.
I understand what you are saying, but the fact remains that quite a few seniors (AARP!) have been lobbying for more government benefits for quite some time. Previous and current recipients of SS and Medicare benefits (those collecting for 8 or so more years, roughly) have received more than what they paid in.
Also, the money paid into the system was spent by politicians. The money you paid in was stolen, and the money you receive now and in the future is being stolen from current workers. It’s a Ponzi scheme, and we all lose.
BTW, I am well over 50 myself. I hope you are correct when you say older people will stand up and say “Stop!”, but I have my doubts. Nobody wants to give up his government goody; he wants the other guy to give up his. If Americans truly wanted smaller government and less spending, we would have it.
The U.S. government is very unlikely to just seize money wholesale from people's bank accounts, as is being done in Cyprus. - But does that mean that your life savings are safe?
No. - There are more sophisticated ways for governments to take what you have put aside for yourself and use it for whatever the politicians feel like using it for. - If they do it slowly but steadily, they can take a big chunk of what you have sacrificed for years to save, before you are even aware, much less alarmed.
That is, in fact, already happening.
When officials of the Federal Reserve System speak in vague and lofty terms about “quantitative easing,” what they are talking about is creating more money out of thin air, as the Federal Reserve is authorized to do — and has been doing in recent years, to the tune of tens of billions of dollars a month.
Whenifhow's comment:
"Dodd-Frank re-defined depositors as investors or unsecured creditors in banks.
"As you well know, depositors have a number of rights, whereas changing the definition of a depositor to mean and investor or unsecured creditor removes 90% of those rights.:
See link at # 13.
Thanks, Whenifhow.
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