I understand that they are broke or nearly broke. I also have been told that they are a good number of ‘zombie’ banks, banks that need to be closed and would have been already, but for the fact that the FDIC is so far under itself it can’t cover the losses.
This is the scary part.
Pursuant to these requirements, staff estimates that both the Fund balance and the reserve
ratio as of September 30, 2009, will be negative. This reflects, in part, an increase in
provisioning for anticipated failures. In contrast, cash and marketable securities available to
resolve failed institutions remain positive.
That’s what I’m reading except it’s worse. Hundreds of banks should already have been closed but FDIC is dragging their feet. You can guess why or why not... money, panic, overwhelmed and so on. Even credit unions are beginning to fold.
CIT is on the ropes again, talk of a VAT tax for needed revenue will kill any hope of a recovery just like a hike in interest rates would, IMF reports it is short of funds, another stimulus being talked about while there is already two unborn generations needed to payoff our debt as it stands now, RE ready for the next down leg....
...I wonder if people really understand what is about to happen?
How long can they keep the shell game going? I had accounts at two banks that failed already... one of the many joys of living in Florida...