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I'm confused about FDIC. If there is a depression, how can the FDIC protect my money? Is it foolish to consider getting it all out into cash? I have savings accounts and CDs in several banks.
It can't in a worst case scenario. If there is a massive bank run with multiple bank failures good luck collecting your money. You will be at the mercy of the Treasury backstopping things.
We did too. This is nowhere near the same but my husband and I lived through a revolution in our country of origin. Whatever money was in the bank was confiscated, you were limited in the amounts you were allowed to have on your person, everything went to the state. For this reason we tend to overreact hence yes we have taken some out. Everyone else commenting here is probably right but having lived through that horrific experience makes you a little paranoid.
Ask the people of Cyprus what happened to "their" money when they showed up to withdraw it from the banks a few years ago........
I lived and survived through FIVE monetary reforms.
I KNOW first hand, how you go to sleep one night and wake up dirt poor. And you considered yourself well off man before.
If anyone for a moment thinks, that this country is somehow immune to this, think not twice, think twenty times.
You just lived in luxury for too long and forgot, how it can turn.
Well... it happened before and could happen again.
It seems that American public does not know about, is that it codifies a “bail-in†provision that ensures that the United States can conduct the type of bail-in that we saw in Cyprus.
To be clear, depositor funds and assets can be legally confiscated by the bank to maintain its solvency. This is called a “bail-in,†and it affects every depositor in the US. If you are like most Americans, you too are a depositor, meaning that your funds are vulnerable to confiscation. If your bank goes bust then your deposits/savings will be taken from you and turned into shares of the bank. You have no say in the matter because in legal terms, as a bank depositor, you are just an unsecured creditor of the bank.
With a bank bail-in, the bank uses the money of its unsecured creditors, including depositors and bondholders, to restructure their capital so it can stay afloat. In effect, the bank is allowed to convert its debt into equity for the purpose of increasing its capital requirements. A bank can undergo a bail-in quickly through a resolution proceeding, which provides immediate relief to the bank. The obvious risk to bank depositors is the possibility of losing a portion of their deposits. However, depositors have the protection of the Federal Deposit Insurance Corporation (FDIC), insuring each bank account for up to $250,000. Banks are required to use only those deposits in excess of the $250,000 protection.
Just FYI:
Banks are not mandated to be FDIC insured. The FDIC does not insure all accounts held at an insured bank.
Not all banks or thrift institutions are insured by the FDIC. Eligible bank accounts are insured up to $250,000 for principal and interest.
The FDIC does not insure share accounts at credit unions. Financial instruments, such as stocks, bonds and money market funds, U.S. Treasury securities (T-bills), safe deposit boxes, annuities, and insurance products are not insured by the FDIC.
More here: https://www.investopedia.com/ask/ans...nk-account.asp
I am confident banks are safe haven for my money. I do wonder if they increased security with a lot of people coming in with face masks. In the past, people that came into banks with a mask on always said three words "stick em up"
I'm not too worried about it either, at least at this point. And in my area, just about every bank lobby is closed so people are only going through the drive through at this point.
I am amazed at the number of people who are complacent about their money,. Where there is money there is always the possibility of those watching it giving in to dishonesty. No society has continued indefinitely without eventually disintegrating.
How soon we have forgotten about all the people who lost their homes and their retirement money in this century! They were told they were secure also. As I remember one person was made responsible for this and everything was supposed to be okay again.
One possibility besides inflation is that we go into a multinational reset and are transferred to a different form of monetary value without our say. It won't matter a bit how much money we have in the bank if those in power decide to make that change and we will not have a say in it. Same situation if one draws it out.
We think we have control of our money but we don't. We haven't since the Federal Reserve was established.
Currently we've been going to extremes since 2007 propping up this dead horse but it can't be done indefinitely. It's the best system ever developed until it isn't anymore. It reminds me of a Ponzi scheme that eventually reaches such a point of manipulation that it can't bear its own weight anymore.
That said, am I panicked? Can't be, I have so little control over what happens. My mother who lived through the Thirties depression told me the first time you see a bank fail to take measures to pay off your debts and make informed choices and I have done that. It's all I can do. With very shaky luck and wise choices I hope we will find new ways to deal with financial issues.
That may not be the worst thing that can happen. My greater concern is increased dishonesty from those in power and increased lack of power for those who are dependent on their good will. This bodes ill for a lot of facets of society besides the financial aspect.
I encourage people to refute denial and begin thinking ahead with acceptance of a changed lifestyle. It will make adjustments easier.
I am amazed at the number of people who are complacent about their money,. Where there is money there is always the possibility of those watching it giving in to dishonesty. No society has continued indefinitely without eventually disintegrating.
Yeah you would think, but the more you see how 90+% of people act like a herd of sheep, not so much......
People are going to be really shocked at how bad things get in the upcoming deflationary bust.
Banks are pretty safe, but not a bad idea to keep some denominations of 5,10,20 and 100 at home. I also keep denominations of 9,12,22, 357,38,45,556 etc just in case it gets real dicey.
This is a good idea whether the financial system collapses or not. If there's a disaster, the electricity could go out, so it's good to have cash in small denominations.
No.
I have zero$ in a bank.
All mine is in my credit union.
If the banking system collapses in a big way, so will the credit unions.
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