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US Deposits In Perspective: $25 Billion In Insurance, $9,283 Billion In Deposits; $297,514 Billion In Derivatives
Earlier today, the American Banking Association reminded Americans that there is absolutely nothing to worry about when it comes to the sanctity of US deposits: after all there is a whopping $25 billion in the FDIC insurance fund which means "insured depositors are safe and their deposits are protected by a strong FDIC fund....The FDIC insurance fund has over $25 billion in reserves and the banking industry " Obviously supposedly "insured" depositors in Cyprus also though there was nothing to worry about, until they woke up on Saturday with a haircut between 6.75% and 9.9% on their money in the bank. Sadly, it may be the case that the ABA is being just modestly disingenuous in its statement. Why? Instead of explaining it in detail, here is a snapshot that does more than thousands of words ever could.
Chart drawn to scale.
The $25 billion in touted deposit insurance is supposed to preserve and protect (granted not in their entirety) some $9,283 billion in total US deposits. A far bigger problem, however, is when one considers the "asset" side of the US banks' ledger: remember deposits are unsecured liabilities. And for US banks, sadly, over the counter derivatives represent the vast majority of "off the books" assets. According to the latest OCC quarterly report, the total derivative notional outstanding of the Top 25 holding companies is $297,514 billion, or nearly $300 trillion. In other words there are 32 times more notional derivatives than there are total deposits, while the ratio of gross derivatives to deposit insurance is a concerning 11,900-to-1.
And with that, we hand it back to the ABA to comfort all US depositors that Cyprus could never possibly happen in the US.
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http://www.scoop.co.nz/stories/PA1303/S00306/national-planning-cyprus-st...
New Zealand to copy Cyprus
don't worry, Goldman has FDIC and they haven't got a single depositor so they won't be needing any of it...
Derivitives are totally insured by AIG, which is backed by the full faith and credit of the US/FED. All is good.
Sarcasm, Off.
A Bitcoin saved is a Bitcoin earned and a lot harder to buzz than greenback deposits....
Any idiot knows you cannot appropriately quantify risk solely by notional.
don't forget about this. 640 trillion in total outstanding derivatives
http://www.zerohedge.com/news/707568901000000-how-and-why-banks-increase...
http://www.bis.org/statistics/otcder/dt1920a.pdf
GUNS BITCHEZ!!
this article is bullshit...there isnt $25bil....the fdic fund went to zero and congress 'allocated' $50bil to fdic. since the us gov doesnt have the cash , there isnt really any money in the fund. also the $25bil that has been 'used' was QE anyway which is vapor money. our fdic can pay EVERY DEPOSIT BECAUSE THE FED CAN PRINT but when we get to that point, printing wont helpor matter.
besides the point that fdic WONT FUCKING COVER THE 'TAX' IMPOSED.....
Who cares, new episode of Jersey shore is coming.
How much cash does govt have in this country, usa?
Musical ATMs
Live streaming from Cyprus !
http://www.ant1iwo.com/livestreaming/
At 18:00 Cyprus time live session of Parliment :)
The Bible prophecy has come true! It says in the Book of Hallucinations: “And in those days, says the Lord, my anger shall be stirred up against the Heathens, and my Chosen People will take over the Central Banks and put such a debt on the Heathens that they will be cursed for generation after generation, and the debt; it will never be paid back!”
It is time for a new type of savings account outside the bank. I propose bitcoin death pool betting savings accounts.
Here is how it works.
Someone sets odds on the likely hood of someone like Jamie Dimon dying in the next 30, 60, 90, 120 days etc. and to make it more interesting extra odds on how, like sniper bullet, hooker poisoning, car explosion, etc.
There are 2 accounts one for yes and one for no people can invest in. Which ever one comes dues the other account in total has to pay a levy which is the percentage of the odds on the other total account. And to make it more interesting if it is a yes offer an initial levy on top of that from the winners side of some arbitrary percentage like 9.9% if they are ballsy enough to provide proof and take claim.
Shit would straighten itself out real quick once a few mid level people found out they are being betted on by people with their own savings.
Just a thought.....
Assassination Politics. The author was put in prison for making threats to elected officials, iirc.
It is a savings slash betting pool there is a difference. People bet on death pools all the time, especially for celebrities, the only difference is the value of the bet in this case. If people want to bet on politicians also that is their perogative. Last time I checked Jamie Dimon and the like are not elected officials.
isnt that the way CDS work?
the buyer pays for CDS protection then blows up or takes out the key assets of the company whose spread has been protected or the company blows itself up and turns into a hedge fund
OR
the seller of protection leverages AIGnam style to pretend it has an income stream (like state pension funds) or the seller (a bank) makes the company look much better by lending it a brazillion or three
A. The principal reason for depositors insurance is to bolster consumers confidence in these banks as a secure place for their valuables (?).
B. If the total is $25 billion in the FDIC fund,and banks have been paying premiums to this insurance fund since the 1930's,where has the bleeping cash gone?!
C. Relatively few banks have failed over the years (prior to deregulation).What of the healthy,well run banks which have paid their premiums over the years,and now watch their insurance premiums rise due to the other risky banks that the gov't wasn't supervising? Isn't this an example of moral hazard? Like what is happening in Cyprus,punishing the many for the sins of the few?
D. The persons who set up the FDIC are spinning in their graves.
The road to hell is paved in good intentions. It is the evil and misguided people running the paving equipment that are the problems.
If you owe someone a $1m dollars that's your problem, if you owe someone $297 trillion dollars, that's everyone's problem.
If anyone wonders how/why these banks get away with total fraud?
Why they will never be touched? DERIVATIVES
It would all be over in a New York minute...
That chart does look a little awesome. Fortunately, there is an insurance policy. Nevada is perhaps the second richest gold address in the world and there are multitudes of companies there at fire sale prices.
Buy some shares, take delivery, and stuff them under the mattress It worked in the Great Depression, no reason why not now. Talking my book here as there's plenty of others but go to www.tsx.com and read up on ATN, PLG, KOR, BVA, AMB, CSQ etc.... No matter the outcome with fiat you'll still buy bread and coffee with it. Save the bars and coins for a house, farm or car after the tsunami.
Got a 1960 quarter back from a retail establishment as change. Told the gal thanks this is a keeper. She said "sorry about that ....it is a bit old and dirty" LOL. Carry on...........
stateside
300 TRillion is not that much ...
I FEEL LIKE CHOKING A BITCH AFTER WATCHING THAT VIDEO HEDGELESS HORSEMEN THANKS FOR RUINING MY DAY U SUCK CACK!!!! :D
In reality, the only insurance that exists to combat a massive banking crisis here is the FED's ability to print until there is no more ink. Doesn't that make you feel secure?
If you went to the bank and wanted to withdraw $10k in cash you would have to wait now.
That's only about 50:1 leverage,,,they can go for 100.