Posted on 03/04/2009 11:45:13 AM PST by txmissy
WASHINGTON — The head of the Federal Deposit Insurance Corp. has warned that the fund insuring Americans’ bank deposits could be wiped out this year without the money the agency is seeking in new fees from U.S. banks and thrifts.
FDIC Chairman Sheila Bair acknowledged, in a letter to bank CEOs, that the new increased fees and hefty emergency premium the agency voted to levy last week will bring a “significant expense” to banks, especially amid a recession and financial crisis when their earnings are under pressure.
“We also recognize that assessments reduce the funds that banks can lend in their communities to help revitalize the economy,” Bair wrote.
But given the accelerating bank failures that have been depleting the deposit insurance fund, she said, it “could become insolvent this year.”
“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,” Bair wrote in the letter dated Monday to the chief executives of the nation’s 8,305 federally insured banks and thrifts.
(Excerpt) Read more at chron.com ...
Actually, I’m a banker - I had better understand.
I should have put ‘more’ funds. By the way, banks are pretty unset about this - that’s why I posted “must” - they don’t really have a choice.
What would happen if say, someone took their money they had in their checking account at a bank and electronically transfered it to say their PayPal account. Would that be stupid?
So they’re pumping hundreds of billions into the black hole of a banking system but have they put one dime into the FDIC fund? Apparently not. Does it make a difference since they are borrowing and/or printing money that doesn’t exist?
If China or any other entity quits buying treasury bills en masse, the whole government may go broke. They have no money. The tax dollars trickling in do not come close to matching the spending frenzy we have been seeing in Washington since October.
Their remaining solution will be to crank up the printing press and inflate the currency. That, I suppose, and confiscating the wealth of the few that still have any.
My opinion is that her assets are very limited.
Just like every government "guarantee", all they are guaranteeing is that they can filch enough from your hard earned labor to pay for other people's screwups and to keep their friends living well.
It is the hope of most conservatives to restore a truly representative republic. This objective will never, ever be met through the ballot box. That day is long, long past. Just spend some time in California (at 12%, a valid subset of the US) in case you have any doubts. Once you reach a tipping point where looters outnumber producers, AND have the ability to vote, there is never any going back until a reset happens.
But here's the thing: real change is truly within our grasp. I happen to have a background in finance & accounting, so I'm able to explain the impact of the current economic situation in terms of achieving conservative goals. I'm not interested in the specific economic points of any particular thread (frankly, they bore me since I've dealt with them my entire professional career). My objective to to use these threads as a segue to once again patiently explain what this means to readers in terms of opportunity to effect real change.
The bottom line is that Barry cannot do a d#mn thing without his ability to: (a) use the power of the state and force of law to exact tribute in the form of taxes; and more importantly, (b) exploit the good faith & credit of the American people to issue Treasuries in which to finance his agenda.
We can't do anything about (a), but we sure as h#ll can do something about (b). The Kenyan can force nationalized banks to lend (and will do so to the worst credit risks - the people who voted him into office), but he cannot make responsible citizens borrow & spend. By helping preserve the system, conservatives are merely contributing to the very agents of their oppression. Quite a paradox, huh?
Save more, spend less. It's all it takes to bring forth a credit default and collapse the welfare state.
As per usual, the successful are forced to bail out the wreckless.
There's always the barter system. What do you have for trade?
I here money can be used in a heating system:
Weimar Republic
LOL!
Thanks for your help.
Just having the $$ electronically transfered to my local bank then will cash it out from there.
I was thinking Eminent Domain. How Would We know ?
If we can’t pay what else would suffice?
...scary stuff going on
Get into a Canadian Bank US branch and buy their bearer bonds.
Either real cutbacks or QE (quantitative easing ie the Fed "prints" money in which to buy Treasuries.) does the trick. We're very close to pushing them over the edge; I'm not even sure we need the Chinese to stop buying.
The boys at CFR seem to think US savers will step in to fill the breach. My goal is to educate conservatives that that is the last thing you want to do. Imagine, loaning money to the very agent of your oppression.
Ping!
It is the hope of most conservatives to restore a truly representative republic. This objective will never, ever be met through the ballot box. That day is long, long past. Just spend some time in California (at 12%, a valid subset of the US) in case you have any doubts. Once you reach a tipping point where looters outnumber producers, AND have the ability to vote, there is never any going back until a reset happens.
But here's the thing: real change is truly within our grasp. I happen to have a background in finance & accounting, so I'm able to explain the impact of the current economic situation in terms of achieving conservative goals. I'm not interested in the specific economic points of any particular thread (frankly, they bore me since I've dealt with them my entire professional career). My objective to to use these threads as a segue to once again patiently explain what this means to readers in terms of opportunity to effect real change.
The bottom line is that Barry cannot do a d#mn thing without his ability to: (a) use the power of the state and force of law to exact tribute in the form of taxes; and more importantly, (b) exploit the good faith & credit of the American people to issue Treasuries in which to finance his agenda.
We can't do anything about (a), but we sure as h#ll can do something about (b). The Kenyan can force nationalized banks to lend (and will do so to the worst credit risks - the people who voted him into office), but he cannot make responsible citizens borrow & spend. By helping preserve the system, conservatives are merely contributing to the very agents of their oppression. Quite a paradox, huh?
Save more, spend less. It's all it takes to bring forth a credit default and collapse the welfare state.
ping for later read
In the final analysis, electronic money isn’t worth the paper it isn’t printed on.
As to this particular case, bank checking is risky. It can be a victim of a credit card collapse, retailers may just refuse personal checks, banks may have a holiday, etc.
PayPal, however, is owned by eBay, a public company.
“In the United States, PayPal is licensed as a money transmitter on a state-by-state basis. PayPal is not classified as a bank in the United States, though the company is subject to some of the rules and regulations governing the financial industry including Regulation E consumer protections and the USA PATRIOT Act.”
So PayPal protections are limited, and it is not an insured institution.
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