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Slamming The Money Market “Gates” – Capital Controls Coming To $2.6 Trillion Industry

Tyler Durden's picture




 

The first time we wrote about the Volcker-led Group of 30 recommendation to crush Money Markets in January 2010 by effectively imposing capital controls and fund "gates", whose purpose was simply to scare investors out of the $2.6 trillion liquidity pool and force said capital to reallocate into a much more "reflation friendly" asset classes such as stocks, many were concerned but few took it seriously. After all, such a coercive push into a "free" market at the time seemed incomprehensible (if, in reality, turned out to be just a few years ahead of its time).

Fast forward two years to July 2012 when the same proposal of "risk-mitigation" by allocating a portion of the balance to a "loss-absorption fund", which would "create a disincentive to redeem if the fund is likely to have losses" was not only re-espoused by Tim Geithner, and the NY Fed but the SEC put it to a vote and the proposal would have almost passed had it no been for a nay vote by Commissioner Luis Aguilar opposing Mary Schapiro in the last minute. Still, once more many largely unconcerned about the implications behind this urgent push to intervene and establish pseudo-capital controls in this major source of potential stock buying "dry powder."

A few months later, following the coercive bail-in of Cypriot deposits, and the new "blueprint" for Europe bank rescues, whereby the authorities have strongly hinted that no more than the insured limit should be kept as as a deposit at a bank and it is preferred that the balance is invested in stocks or some other ponzi-enabling instrument, many have finally started to wonder if indeed there isn't some overarching strategy to "tax" financial assets in a world slowly but surely going insolvent and where the much desired debt inflation is so slow to materialize (just as we predicted would happen in September of 2011 in The "Muddle Through" Has Failed: BCG Says "There May Be Only Painful Ways Out Of The Crisis").

Today, with a brand new leader, Mary Jo White, now that the clueless and co-opted Mary Schapiro is long gone, the $2.6 trillion Money Market Fund industry is one step closer to finally being gated. But don't it call it that - the SEC prefers the term "protecting investors"

From Reuters:

A portion of the $2.6 trillion money market fund industry would be required to fundamentally change how it prices its shares in an effort to reduce the risk of abrupt withdrawals, under a proposal released by U.S. regulators on Wednesday.

 

Funds could also charge withdrawal fees and delay return of funds to customers in times of financial distress, under the Securities and Exchange Commission's proposal.

 

The SEC plan comes after a long debate over whether changes made in 2010 were enough to avoid a repeat of a run on money market funds seen at the height of the financial crisis.

Naturally, those who see the writing on the wall - the MMF industry - is not happy:

The fund industry has warned that further major reforms could kill investor interest in money market funds.

Well, of course. After all this is the whole point. Recall what we said in July of 2012:

In a nutshell, money market funds (much more on this below), have always been one of the most hated liquidity intermediaries by the central planners: they don't go into stocks, they don't go into bonds, they just sit there, collecting no interest, but more importantly, are inert, and can not be incorporated into the rehypothecation architecture of shadow banking.

 

And perhaps that is precisely why the Fed is pulling the scab off an old sore. Recall that for the past year, our primary contention has been that the core reason for all developed world problems is the gradual disappearance of good collateral and money good assets.

 

Even if the MMF cash were to shift, preemptively, into bonds, or any other "safe" investments, the assets backing the cash can them enter the traditional-shadow liquidity system and buy time: the only real goal at this point. In the process, the cash itself would be "securitized" and provide at least a year or so in additional breathing room for a system that has essentially run out of good liquidity, and in Europe, out of any collateral.

 

Expect more and more efforts to disgorge the $2.7 trillion in money market funds as the world gets closer and closer to D-Day. And what happens with MMF, will then progress to all other real asset classes as the government truly spreads out its capital controls wings.

Funny: we said this 9 months before a capital control "disgorgement" struck in Cyprus. Fear not: it is coming to every other "taxable" financial asset. But whereas we thought the money market forced capital expropriation would be first, some places like Europe were so desperate they couldn't afford to wait that long.

So what proposals is the SEC planning on applying in order to enforce the capital reallocation pardon avoid investor losses? There are two, both perfect strawmen, and have been well-known since the first time we approached this topic three and a half years ago.

In a compromise move, the SEC's plan mostly focuses on prime funds for institutional investors, which are seen as more prone to runs because those investors are more sophisticated and more likely to pull large blocks of money first if there is a panic.

 

The SEC estimated that institutional funds represent 37 percent of the market with $1 trillion in assets.

 

The SEC's plan calls for two alternative proposals that it said could be adopted alone or in combination.

 

The first piece would require prime funds used by institutional investors to transition from a stable, $1 per share, to a floating net asset value (NAV) - a move designed to reduce the risk of runs like those during the financial crisis.

 

The SEC said that retail and government funds, which are not considered to be at the same risk for runs, would not have to move to a floating NAV. Retail funds are defined as those that limit shareholder redemptions to $1 million per day.

 

The industry has long fought against moving away from a stable share price, which it says is appealing to investors looking for a safe product.

 

The second proposal, meanwhile, would give fund boards for institutional and retail funds the authority to impose so-called "liquidity fees and redemption gates" during times of stress.

 

That would give funds the power to stop an outflow of investor money, an idea that the SEC's two Republican commissioners last year said they might be able to support.

We are not sure what is more amusing: that the SEC is so naive it thinks someone will actually believe it can prevent a capital run in a financial panic, or that its transparent attempt to spook money market investors away from their holdings now that the threat of imminent lock ups and gates looms over their heads is not what this is all about. We anticipate that the SEC will drop numerous analogies to Cyprus as a reminder that if something can be gated, it will be gated.

What is more important, is that unlike Schapiro's plan the current SEC proposal should have no difficulty in passing.

The initial industry reaction on Wednesday indicated the SEC's plan may not generate the same degree of opposition that the SEC faced last summer when then-SEC Chair Mary Schapiro called for what some consider stricter reforms.

 

Schapiro, who stepped down as SEC head last December, had advocated for a series of possible reforms, including capital buffers and redemption holdbacks, or a broader switch to a floating NAV - two ideas vehemently opposed by the industry.

 

She was unable to muster the votes needed to issue a proposal for comment after three of her fellow commissioners said they could not support her plan without additional study.

 

Schapiro's proposal was starkly different from what the SEC unveiled on Wednesday. This time, the SEC's plan contains some proposals that a few fund sponsors have previously said they could live with.

 

"It has been a journey to get to this point," said SEC Chair Mary Jo White, who took over the agency earlier this spring.

And if the industry is onboard, all the token SEC votes needed to enforce the plan will be in place.

At that point money markets will merely be the latest experiment in behavioral control: how to spook those with money in the multi-trillion industry enough to where they pull their cash and either spend it on trinkets, boosting inflation - a very welcome outcome for the Chairman - or merely investing it in the "stock market." Perhaps instead of a lock up, at times of crisis MMF investors will be given the opion of allocating funds to the Solyndra du jour (a la the Cyprus bank bailout) or lose all the money.

We are confident the central planners will find a way,

 

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Wed, 06/05/2013 - 20:44 | 3628188 fightthepower
fightthepower's picture

Fuck you Bernanke! Fuck you Rothschilds!

Wed, 06/05/2013 - 20:55 | 3628224 kliguy38
kliguy38's picture

relax and it won't hurt for long......after the first few centuries .....we should be used to it

Wed, 06/05/2013 - 21:02 | 3628239 Jeff Lebowski
Wed, 06/05/2013 - 21:03 | 3628250 Pladizow
Pladizow's picture

Qui Bono - I'm sure a very large % of those MMF's will be diverted to bank deposits which will then be leant out at a ratio of 9:1 through fractional reserve banking and ultimately Bailed In!

Wed, 06/05/2013 - 21:04 | 3628258 fonzannoon
fonzannoon's picture

Much of those MMF's are in 401(k) accounts that cannot be withdrawn because somone is still employed. I bet Bartiroma herself lobbied for this so she can finally say she was right about cash on the sidelines coming into the market (at gunpoint).

Wed, 06/05/2013 - 21:07 | 3628264 LetThemEatRand
LetThemEatRand's picture

Remember the days when putting your assets into an MMILF was not only free, but you'd get dinner out of the deal?  

Wed, 06/05/2013 - 22:57 | 3628535 markmotive
markmotive's picture

When the MM smackdown actually happens we will have fucking anarchy. Madness in the streets. MM locked down, bank accounts frozen. The whole system will freeze.

Meanwhile, babies still shit their diapers, winter is still cold and your leaky roof still needs fixing. How long can a father watch his children starve until he decides to knock over a grocery store? And when the cops don't show anymore because they're not getting paid, how long can the grocery store owner watch angry men steal his livelihood?

Better know how to survive when shit hits the fan.

http://www.planbeconomics.com/2013/05/sas-survival-secrets-full-series.html

Wed, 06/05/2013 - 23:26 | 3628546 TwoShortPlanks
TwoShortPlanks's picture

Money Markets?...Mirage Markets!


Potemkin Intelligence hides the Global Ponzi Wealth Mirage


Every economist knows that the quickest, easiest and best result when aiming to raise Money Velocity is to increase general wealth. The best way to do that is to target the wealth of the middle class, and the middle class’s single most valuable asset is their home. Boost housing prices and you boost wealth perception and this increases consumer confidence…blah, blah, blah. Of course wealth is completely subjective and relative to something else of perceived value, something else with which a home owner can gauge and measure wealth, magically tucked away under their roof, a gauge such as currency. This is the Western Potemkin Intelligence, it is an ego which overpowers common sense and fights the obvious truth, hidden in plain view, that the illusion of prosperity is nothing more than a wealth mirage trapped within a fractional reserve debt based monetary system, of a Global Ponzi Paper System. Keynes’s ‘Animal Spirits’ fight and toil within a fictional banking fog, nothing more. But as the Golden sun rises in the East that fog will disappear, and with it clarity. We will come to realise the desperation of our situation, that we have been duped, abandoned and lost in a desert of paper wealth, still indoctrinated by western conditioning and bias, like some slow lumbering chain gang we will stagger, shackled to each other in mere paper bonds we stupidly believe to be hardened steel…pathetic! In stark contrast, ultra-wealthy elite have been accumulating physical Gold behind the scenes since the 1970’s.

http://twoshortplanksunplugged.blogspot.com.au/2013/06/potemkin-intelligence-hides-global.html

TwoShortPlanks

Wed, 06/05/2013 - 21:41 | 3628337 ImReady
ImReady's picture

I sold out of all funds in my 401k recently and have it sitting in the MMF within the plan. Looks like it's time to cash out and take the tax hit. These actions by the SEC are making  it much more palatable to do so. A no brainer really...

Wed, 06/05/2013 - 21:46 | 3628356 fonzannoon
fonzannoon's picture

Are you currently employed with the same company that you have the 401(k) with or is it an old 401(k) that you left at an old job? Cause if it is your current plan you may not like the answer you get when you try to do that.

Wed, 06/05/2013 - 22:01 | 3628398 ImReady
ImReady's picture

I own the company. If they don't want to give me MY money I will close out he plan.

Wed, 06/05/2013 - 22:18 | 3628403 fonzannoon
fonzannoon's picture

My guess is that is exactly what will happen. Good for you, give em hell.

Hey Imready, I was just thinking. Ask your provider about instituting an "in service withdrawal" provision in the plan. you may have to move to a new provider if they won't add it. But there are plans out there that will allow it. good luck.

Wed, 06/05/2013 - 23:10 | 3628568 CheapBastard
CheapBastard's picture

I once met one of the Tip-Top litigators in Fort Worth years ago. He said, "When someone smiles, puts out their hand and says, 'You can trust me,'" ....you better run the other way.

Wed, 06/05/2013 - 23:50 | 3628656 ImReady
ImReady's picture

Thanks fonz! 

Thu, 06/06/2013 - 20:41 | 3632015 Ranger4564
Ranger4564's picture

You can quite often transfer your money out of a 401K / IRA plan and cash out, or rollover to another IRA, such as a self-directed IRA. About 4 years ago, I closed my Vanguard and MFS fund investments (gradually over a year) and moved them to a self-directed IRA which I exchanged into Gold and Silver Bullion at a depository. Sterling-Trust is one such Custodian that will maintain your self-directed IRA, then they use a depository as the holder... Delaware something or other was the depository. Great thing is, you can close your IRA, pay the fees, and get the physical metal or cash delivered to you. I closed my IRA about a year ago, just finished paying the tax hit in the 2013 tax bill. They delivered the gold and silver I had invested, physically to me, as requested.

You can also look into opening your own LLC / LLP which is allowed to hold your IRA cash, and you can hold gold / silver in that framework... I don't know much about this, but one of my colleagues went this route with his IRA... started the LLC / LLP, transferred money from the IRA to his LLC / LLP, used the money to buy gold / silver. It's considered to still be in the IRA / 401K system.

I told that colleague, that legal constraints may make it more painful to ever withdraw the gold / silver... but this individual might in the end, end up paying less in taxes than I did.  My hit was 28% plus 10% penalty, I believe.

 

Thu, 06/06/2013 - 05:38 | 3628975 August
August's picture

Over the last three years I totally distributed all of my retirement plan assets.  It feels good, now that all the checks have been sent in to Uncle Sugar.  I got a nice note saying that they'd put my name on a MOAB of my own

Wed, 06/05/2013 - 21:44 | 3628344 GAAP is crap
GAAP is crap's picture

banks lending?  to each other maybe.  Nah...this is going into treasuries and shadow banking.  that money market or "cash" account in your 401k...treasuries.

 

Thu, 06/06/2013 - 05:14 | 3628959 Urban Redneck
Urban Redneck's picture

The MMFs assets are already leant out (rehypothecated) at a ratio of XX:1, just to maintain equilibrium (status quo) far more than $1 trillion will have to be printed.

Thu, 06/06/2013 - 06:12 | 3629012 Ghordius
Ghordius's picture

which goes back to the hidden elephant in the room in this MFF discussion: interbank lending

Thu, 06/06/2013 - 06:46 | 3629056 Urban Redneck
Urban Redneck's picture

The suicide pact of the circular firing squad.  They can gate and print to prop up interbank lending over the short term, but only if they actually and finally write down derivative claims, otherwise the amounts make the Wiemar experiment look the antiquated product of a manually operated Gutenberg press.  I don't think even the Italians- with their yearning for and fond memories of 1000 lira toilet paper would stand for that.

Thu, 06/06/2013 - 03:23 | 3628915 The_Dude
The_Dude's picture

Jeff...please go back to watching John Stewart to get your news and leave the adults to talk.....

Thu, 06/06/2013 - 07:12 | 3629081 Jeff Lebowski
Jeff Lebowski's picture

Obviously, you're not a golfer.

Sad. I've been here for nearly four years and you still need to /sarc clearly sarcastic comments.

Thu, 06/06/2013 - 07:20 | 3629096 Bearwagon
Bearwagon's picture

No, you don't. Come on, man up! ;-)

Wed, 06/05/2013 - 21:55 | 3628377 SRSrocco
SRSrocco's picture

This is exactly what I am talking about.... increasingly worthless paper assets going forward.  The best protection is in physical assets such as gold and silver:

The Greatest Fundamental Reason to own Precious Metals
Wed, 06/05/2013 - 22:00 | 3628397 Urban Roman
Urban Roman's picture

Let's see ... they're worried about deflation, that is, worried about the "velocity" of money. They think it might not change hands often enough to keep the economy going. 

So they put barriers in its way!?

Thu, 06/06/2013 - 08:08 | 3629161 ParkAveFlasher
ParkAveFlasher's picture

MMF is where money pools, not moves.  

Thu, 06/06/2013 - 20:49 | 3632039 Ranger4564
Ranger4564's picture

Yeah, but it sounds like the intent is to stop people from taking out large sums of money all at once. So it's not that they want it moving, they don't want it withdrawn all at once.

Wed, 06/05/2013 - 21:33 | 3628316 MFLTucson
MFLTucson's picture

Identical to what the Jewsih Bankers did to the German economy now known as the Weimar Republic.

Thu, 06/06/2013 - 06:27 | 3629031 The Wedge
The Wedge's picture

The Wiemar Republic ran up a sizable debt during the war and the allies forced them to pay heavy reparations. This and many other factors led to hyperinflation and then to the rise of Hitler.

In 1921, the Allies set Germany's reparations at 132 billion goldmarks (pegged at the value of the mark in 1913). From then until 1932 an estimated 26 billion goldmarks was paid out in cash and goods, corresponding to an annual 10 percent of national income. In other words, although the burden was considerable, it was more-or-less affordable.

It was less the size of its reparations than continued uncertainty about them that destabilized the Weimar economy. The mood was especially vitriolic within the Reparations Commission, with the French --- keen to exact revenge for their military defeat in 1871 -- proving completely intransigent.

It therefore took just a relatively minor delay in the delivery of wood, coal and telegraph poles to escalate the conflict, and in January 1923 France marched 100,000 soldiers into Germany's Ruhr valley, seized control of the mines, and confiscated the coal. "This was a fatal blow to German industrial production," Holtfrerich says.

An entire region ground to a halt, and an important source of tax revenues dried up. Because the Ruhr valley was no longer permitted to deliver coal, Germany was forced to obtain its fuel elsewhere -- often from abroad at great cost, depleting its much-needed foreign currency reserves.

Millions, Billions, Trillions: Germany In The Era Of Hyperinflation

Alexander Jung

 

Wed, 06/05/2013 - 20:47 | 3628194 BeetleBailey
BeetleBailey's picture

DOWN with the government.

 

There...I said it.

 

Fuck em.....bastards, liars, pigs, power mad cunts the lot of them.....

Wed, 06/05/2013 - 21:05 | 3628260 Richard Chesler
Richard Chesler's picture

Corrupt in-your-face.

Now that's transparency you can believe in.

Wed, 06/05/2013 - 21:07 | 3628266 max2205
max2205's picture

Funny I dont see how this rule would prevent runs....it will make a run before it becomes a rule...

 

Fucking morons

Wed, 06/05/2013 - 21:33 | 3628313 Yes_Questions
Yes_Questions's picture

 

 

We'll call it the Olestra Rule.

 

Thu, 06/06/2013 - 02:04 | 3628687 G-R-U-N-T
G-R-U-N-T's picture

"many have finally started to wonder if indeed there isn't some overarching strategy to "tax" financial assets"

There's no wondering about it. Once private cash can no longer pay the bills they will come after our assets! They will do anything to keep power and control these idiots will, indeed, burn the village down to save it!

It has to crash and burn so a new business cycle can begin! Unfortunately there will be a tremendous amount of pain to be endured, look at Southern/Northern Europe, Turkey and Germanies economic growth is sliding. Soon the wave of civil unrest, birth pangs of change, will swell to the west as more confiscation, more unemployment, more regulatory controls, ad infinitum...because politicians haven't a clue what they are doing as their policies testify. The Fed was suppose to stabilize the idiocy that came out of the legislature but it has no more magic to pull out of the hat.

Marxism never ever has worked and these dumb shits that continue to believe in failure haven't the brains to learn from history. It's fuckn' pathetic! So here we are at the downturn and within the next few years the true residue of what these numskulls in Europe, Washington, and their bureaucrats with all their idiotic brilliance,prestigious academic sophisticated nonsense will have caused the greatest bankruptcy that the world has ever seen! When government gets involved and begins thinking they know something about economic trade, while creating policy to manipulate it, this is always the end result, collapse!

 

Fri, 06/07/2013 - 21:59 | 3636134 Yes_Questions
Yes_Questions's picture

 

 

No one may ever see the beauty of your avatar in this, little thread, but I do.

 

And + on the post too.

Wed, 06/05/2013 - 23:34 | 3628613 knukles
knukles's picture

Law of Unintended Consequences

Hypothetically.  Everybody here on the Hedge has all their money in MMMFs.  Panic hits.  Gold goes to $250/oz and S&P to 600, 30 year treasuries to 18%.
Disaster in every single market there is, world wide.

All Hypothetical...

And so all the smart folks here on the Hedge, try to redeem all their money from the MMMFs to buy the assets at the BARGAIN of a lifetime.

And they make us stay in the MMFs

Talk about "cash on the sidelines"
All Hypothetical

Except this:
Fucking Idiots.

Thu, 06/06/2013 - 00:33 | 3628737 Meat Hammer
Meat Hammer's picture

When they say "our financial system" that's exactly what they mean.

Thu, 06/06/2013 - 00:56 | 3628780 RockyRacoon
RockyRacoon's picture

Clever.  So, you're saying it's a closed loop.  I like it.

Thu, 06/06/2013 - 07:43 | 3629130 HardAssets
HardAssets's picture

Better to study criminology than economics/finance. 

The con man/robber already thinks your money, is 'his'.

All the legal & economic gibberish they spout is pure crap. Their objective is to get your money so they can cover themselves a little while longer. And at a higher level (beyond politicians & even most big financial players) the objective may be to bankrupt you and make you dependent so the New World Order can be implemented. Welcome to the new global serfdom.

Thu, 06/06/2013 - 05:30 | 3628968 Urban Redneck
Urban Redneck's picture

quality collateral availability, asset encumbrance, and the velocity delta (which this action only addresses within MMFs as opposed to systemically)...

Luke 23:34

Thu, 06/06/2013 - 05:55 | 3628993 fonzannoon
fonzannoon's picture

it seems from reading more that "government money market funds" will be exempt from this. Basically, if you are in U.S debt, you have no worries.

Thu, 06/06/2013 - 06:37 | 3629041 Urban Redneck
Urban Redneck's picture

Tell that to people who were in the Reserve FundSSSSSSS last time around - US government debt is no safer than any other for a MMF, even the .gov only funds got locked up until maturity of the fund assets.  

Thu, 06/06/2013 - 06:42 | 3629048 fonzannoon
fonzannoon's picture

Getting locked up until the maturity would be a privilage this time around.

Thu, 06/06/2013 - 06:52 | 3629063 Urban Redneck
Urban Redneck's picture

Or a lost opportunity, particulary if velocity does pick up in the interim (which can be extended by litigation).  You might be better offl buying treasuries directly yourself, then you at least could have them wired to a bank that's open for business and collateralized for a shopping spree.

 

Thu, 06/06/2013 - 11:02 | 3629803 aphlaque_duck
aphlaque_duck's picture

The issue is private debt leveraging.

Money markets funds, being a cash equivalent, can be used as collateral against which further cash equivalents are loaned. This creates a fractional reserve, money multiplier effect just like when banks lend for mortgages. Tons of debt is accumulating in the "shadow banking system" in this manner - the risk is some day people will try to redeem that debt to buy stuff and this would kick off yet another systemic crisis or currency failure. 

Trying to find some links for you, I just found this paper which looks to be from this year: http://digitalcommons.law.seattleu.edu/cgi/viewcontent.cgi?article=2146&...

Google: money market funds private debt leveraging money multiplier

 

Wed, 06/05/2013 - 20:49 | 3628199 oc
oc's picture

Tyler,

 how'd you get a pic of my front gate ?

Wed, 06/05/2013 - 20:58 | 3628235 greatbeard
greatbeard's picture

Your front gate?  Heh, that's my back gate.

Wed, 06/05/2013 - 21:16 | 3628269 sunaJ
sunaJ's picture

I have a good idea of outflow for these MMF MFers...How about gold and silver? It just "sits there inert," and the great thing is you possess it if you are smart. It is, after all, REAL money...problem solved for you, and an extremely egregious problem for the fascist financiers.

Thu, 06/06/2013 - 02:17 | 3628865 Manthong
Manthong's picture

"that's my back gate."

it looks just a skoshe smaller than the gate on my dog run. 

Wed, 06/05/2013 - 20:51 | 3628204 otto skorzeny
otto skorzeny's picture

"clueless and co-opted"- that's redundant when referring to anyone in govt.

Wed, 06/05/2013 - 20:51 | 3628207 Hannibal
Hannibal's picture

Don't just say "Fuck You'...but get out of paper and out of the system.

Wed, 06/05/2013 - 22:50 | 3628517 tao400
tao400's picture

they will come after the pms also brother.

Wed, 06/05/2013 - 23:46 | 3628641 tsx500
tsx500's picture

that will go well ..... NOT ! idiot.

Thu, 06/06/2013 - 06:45 | 3629054 Jendrzejczyk
Jendrzejczyk's picture

"They" are coming after every freaking asset on the planet.

Wed, 06/05/2013 - 20:54 | 3628221 NidStyles
NidStyles's picture

Here's an idea, let's create a system of fake wealth and when it starts showing signs of weakness we will just fuck everyone that bought into it, and then still expect them to trust us.

 

Who needs to prove that governments are all corrupt, they do it for you...

Wed, 06/05/2013 - 20:55 | 3628225 Hedgetard55
Hedgetard55's picture

This whole fucking shithouse is coming down soon, right on our heads, and they will do whatever they can to take every last fucking penny from you. 

Wed, 06/05/2013 - 21:26 | 3628299 Yes_Questions
Yes_Questions's picture

 

 

The Money does say FEDERAL RESERVE NOTE on the top of each one.

 

and given our dealings with the IRS, I am pretty sure these notes, physical or electro, are NOT ours to own, but have access to and some range of options what to acguire with them.

 

So, its theirs to take, I am sad to report.

 

+1

 

 

Wed, 06/05/2013 - 20:56 | 3628230 Hannibal
Hannibal's picture

"Once upon a time there lived a Saudi Clan in a city called Sarasota in the United States. The clan was visited by Mohamed Atta – the government-designated top hijacking terrorist who according to the government led the largest terrorist event in United States’ history – known as 9/11. The clan’s Sarasota house was visited by this lead hijacking terrorist not once, not twice, but many times. The clan also had visits from two other US government-designated 9/11 hijacking terrorists – Marwan Al-Shehhi, who supposedly crashed United Airlines Flight 175 into the South Tower, and Ziad Jarrah, who was supposedly at the controls of United Airlines Flight 93 when it crashed in a field in Pennsylvania.

Are you with me so far? Let’s simplify and sum this up so far for the sake of our simplicity-loving majority: Three 9/11 hijacking terrorists visited a Saudi Family in Sarasota repeatedly before 9/11"....

more:

http://www.boilingfrogspost.com/2013/06/05/the-doj-fbi-have-it-both-ways...

Wed, 06/05/2013 - 21:08 | 3628268 nmewn
nmewn's picture

"...was visited by this lead hijacking terrorist not once, not twice, but many times."

Sounds like a leading candidate to head the "new and improved" IRS.

Wed, 06/05/2013 - 21:32 | 3628314 Bear
Bear's picture

The 9-11 Tea Party would never get tax exempt status

Wed, 06/05/2013 - 23:38 | 3628619 knukles
knukles's picture

But that Fucking "Saudi Clan" Sure as Hell Would.

Arab Spring and all that shit
God, I feel safer with Susan Rice becoming our National Security Advisor... what with her insights into that clip on YouTube causing the Benghazi demonstrations that went a tad awry....

AAAAARRRAGH! 

Wed, 06/05/2013 - 20:58 | 3628233 whisperin
whisperin's picture

It will be a horse race to get this in place before geopolitical events spin out of control. Once the first shots (the real ones) are fired chaos will ensue and plans are one of the first things left in tatters. Unfortunately, the idiots in charge think that they can control events to ensure a desired outcome. They may be surprised indeed at the outcome they have achieved!!!

Thu, 06/06/2013 - 08:05 | 3629153 HardAssets
HardAssets's picture

"Shit happens"

there are probably a few of us out here who are counting on this.

The psychopath/sociopath criminals are control freaks.

But often events don't unfold as planned.

Wed, 06/05/2013 - 20:59 | 3628238 JJ McApe
JJ McApe's picture

Fewer jobs more poverty one said on here this morning,less money,,things are so rosy now that the fed is not promising tones of more free money.But heyyyyyyyyyy oil is doing great isn't it,no one has the money to buy it,but its up,oh ya,I know,the oil inventories are down 8 million barrels compared to last week,thats a crock. Where did it go? they must of sold it to the Saudis for a bigger profit than they could get here for it. It #$%$ me off big time to see oil bend us over,when the entire world is barely holding on by its teeth,and oil is going to screw us to death for every penny it can. And even worse is American oil now,hell those that live in saudia Arabia pay about 50 cents a gallion if that,and yet here we would rather export our oil,than to sell it in this country,and forget any of us getting any kind of break from American oil business. we will only get the business from them,,you know,the business end of something blunt and long

Wed, 06/05/2013 - 21:00 | 3628241 nmewn
nmewn's picture

Yes, drives em crazy when they can't see it, can't account for it, not "in the system" anymore...lol.

Wed, 06/05/2013 - 21:03 | 3628253 fonzannoon
fonzannoon's picture

I have my wife's 401(k) in the money market. She said "I heard the market tanked today, I guess it's good we are not in it". I showed her a few paragraphs from this article. The onset of reality is always interesting to watch live.

Wed, 06/05/2013 - 21:07 | 3628267 insanelysane
insanelysane's picture

Fortunately for us the government is doing it for our own protection.  They haven't sent my daughter her refund yet either, and when she called they told her it was for her own protection.

Wed, 06/05/2013 - 23:45 | 3628640 imbrbing
imbrbing's picture

Awesome....

Wed, 06/05/2013 - 21:09 | 3628272 LetThemEatRand
LetThemEatRand's picture

How did I end up on this site?  Oh, typo.  I typed "money markets I'd like to fuck" into google.  My bad.  Back to "surfing."

Wed, 06/05/2013 - 23:38 | 3628620 mt paul
mt paul's picture

googled

monkey markets ....

linked to this article 

Wed, 06/05/2013 - 23:40 | 3628625 knukles
knukles's picture

I was wondering if I was the only one who caught that.... :)

Thu, 06/06/2013 - 00:04 | 3628690 LetThemEatRand
LetThemEatRand's picture

I was going to congratulate you on your intelligence, but I think we're just both equally depraved.  So party on Wayne.

Wed, 06/05/2013 - 21:09 | 3628273 buzzsaw99
buzzsaw99's picture

I remember when old greedscum raised the rate to 5.25%. Man those were the good old days of MM funds. Too bad they didn't last. Oh yeah, fuck you bernanke!

Wed, 06/05/2013 - 23:41 | 3628629 knukles
knukles's picture

Or under Paulie "Let All Hell Break Loose" Volcker when 30 year treasuries were at 15 3/8%

Them were the good olde days.
Fucking world was sane then, too....

Wed, 06/05/2013 - 21:11 | 3628275 kchrisc
kchrisc's picture

This will backfire, as a lot of the funds/cash pushed out will probably land in PMs.

That's what me thinks, what say others?

Wed, 06/05/2013 - 21:14 | 3628279 fonzannoon
fonzannoon's picture

I respectfully disagree. First off like I said above, a ton of this money resides in 401(k) accounts where employees can't pull it if they are employed. Secondly, and more importantly, this goes well with the JPM gold vault articles. By that I mean all gates will shut completely at the same exact moment.

Wed, 06/05/2013 - 21:17 | 3628285 Yen Cross
Yen Cross's picture

  I respectfully, have an few questions?

Wed, 06/05/2013 - 21:29 | 3628310 notadouche
notadouche's picture

Perhaps you can't pull what you have but you can stop funding it and just take the cash home on a paycheck per paycheck basis and to hell with whatever company BS match there is and start stuffing matresses.  Matresses have no gates or penalties for early withdrawal.

Wed, 06/05/2013 - 21:34 | 3628320 fonzannoon
fonzannoon's picture

It's very true. Everything is a risk. My wife is vested and they match. So I have her putting in the bare minimum to get the match. I know full well where this can go at any moment.

Wed, 06/05/2013 - 22:19 | 3628437 quasimodo
quasimodo's picture

Fuck that noise, I quit putting a penny in mine and the wife's over a year ago. I would rather spend it on tangibles that will get me something in return, believe me it was not easy telling wifey she had to quit putting money in for her "free money match"......so sick of hearing about the "free money" we are missing out on. I am about ready to take the tax hit and cash mine out alltogether, yet somehow can't get the balls to do it yet.

Wed, 06/05/2013 - 22:29 | 3628462 fonzannoon
fonzannoon's picture

some people skydive. others scuba. I leave money in a money market. I'm fuckin crazy i tell you.

Wed, 06/05/2013 - 22:50 | 3628516 dogbreath
dogbreath's picture

get out asap

Wed, 06/05/2013 - 23:44 | 3628637 knukles
knukles's picture

Hi Dog,
You'd asked me to contact you and I'd requested a relationaship approval.
Your move...
K

Wed, 06/05/2013 - 23:55 | 3628669 Yen Cross
Yen Cross's picture

 Can I ask my Question?

  I was going to ask Fonz how his clientele felt about higher yields. I know Fonz has is investors best interests at heart.

Thu, 06/06/2013 - 00:59 | 3628765 dogbreath
dogbreath's picture

Knuckles

 

first time trying to set this up.   I still want to chat

 

edit:  I'm signed into the chat room.  I'm in MST and am here morning and evening and somtimes all day long. I approved your contact.  So talk to you when its convenient.

Thu, 06/06/2013 - 13:22 | 3630553 knukles
knukles's picture

Gotcha Dog...
Anytime we're on, I'm available to chat.
K

Thu, 06/06/2013 - 08:24 | 3629192 HardAssets
HardAssets's picture

Well, the problem with the matching feature and long term tax benefits , . . . yada, yada, yada IMO is that you have to believe that the crooks in charge have intregrity and won't change the rules sometime to benefit their paymasters, . . . at the drop of a hat. Every aspect of the way the 'rules' are set up is to benefit them, at your expense.

The whole damned system is corrupt from top to bottom.

Thu, 06/06/2013 - 00:07 | 3628691 Cobra
Cobra's picture

No penalty for taking a loan and paying it back at $10 / wk either...

Edit: dude below me wrote it / did it already. Never mind.

Wed, 06/05/2013 - 21:53 | 3628370 TheReplacement
TheReplacement's picture

I agree with you.  Respectfully I too have some questions.  Having seen you post here frequently, I think you have a grounded take on things.  

Being a smart guy I took a loan against the my full contribution in my 401k about a month ago figuring the market is at record highs and interest rates are never going to be lower.  After the last few days market activity that looks like a good call.  I then moved the remainder (company contributions) to MMF, well as much as was possible considering the plans available don't allow for 100% allocation.  

Do you or anyone else here have any suggestions as to the next move with the remaining contributions as well as ongoing contributions?

Danke comrade. 

Forward!

Wed, 06/05/2013 - 22:03 | 3628402 swmnguy
swmnguy's picture

Employees in 401(k) plans who have money in MM's will keep it there.  That's the default for most plans if the employee doesn't make a different choice, and many do not.  They also associate stocks with riska and bonds with boring/no return, so they think MM's are safe and provide at least some change.  They probably haven't heard about Cyprus, and don't understand that they are at the back of the line to get their money back from their bank accounts, much less their MM fund.  I don't know what proportion of the whole that this money makes up, but most of it will stay put.

Wed, 06/05/2013 - 22:05 | 3628406 fonzannoon
fonzannoon's picture

I know Fidelity for example has around 30% of their assets in MM's, I'd say that is representative of the industry.

Wed, 06/05/2013 - 23:29 | 3628600 Colonel Klink
Colonel Klink's picture

Derp

Wed, 06/05/2013 - 23:33 | 3628604 Colonel Klink
Colonel Klink's picture

Apparently I'm being misdirected under this post:

 

Fonz,

Don't know how you disagree, it's exactly what I did.  It's called going Galt.  However not everyone can do it.

They're welcome to play in their own Judenfetzen world.  Mine is phyzz.

Thu, 06/06/2013 - 05:19 | 3628963 fonzannoon
fonzannoon's picture

u are smart. smart usually means you are the exception.

Thu, 06/06/2013 - 06:54 | 3628987 Urban Redneck
Urban Redneck's picture

Didn't you get TPTB's memo, the gold bubble burst and gold is a losing "investment"... more importantly-

Where are they going to find the physical gold to invest in? As no one in a hurry (or panic) is going to send their cash off to an unseen merchant in exchange for a promise to deliver a physical good at some point in the future (i.e. an extension of credit when the credit market is violently contracting).

 

 

When they is a guy who who can covert the bulk of his MMF assets at the LCS then there might be some action for a day or two.

However, when they is a corporate treasurer (who collectively control the bulk of the fast moving MMF assets), it simply isn't even an option (and they aren't necessarily even authorized or permitted under law to invest in physical commodities).

Wed, 06/05/2013 - 21:15 | 3628283 Yes_Questions
Yes_Questions's picture

 

 

Will full redemptions be allowed to buy Gold?

 

Houses?

 

Coke/Prostitues?

 

If they are trying to get this money into stocks, the Fed Will have to keep up the illusion of a robust market.  But, don't most trading accountss sell into MMF?

 

I'm confused.

Wed, 06/05/2013 - 21:17 | 3628287 Stuck on Zero
Stuck on Zero's picture

Thus could be good.  It will force investors to think about moving their money into physical PMs.

 

Wed, 06/05/2013 - 21:57 | 3628381 TheReplacement
TheReplacement's picture

That's all well and good except as noted 2x above a lot of money is in there via 401ks.  My 401k does not provide for phyz.  Does yours?  Ever heard of such a thing?

They people who can pull out and go into phyz are probably going to be okay anyway because they have enough wealth to actually be able to manipulate it as they wish.  As for the middle class... mommy it hurts.

Wed, 06/05/2013 - 23:53 | 3628664 20834A
20834A's picture

Entrust Group does rollover into PM IRAs. Think it's paper, or maybe allocated. This in no wise constitutes an endorsement. Do you own due dilligence.

Thu, 06/06/2013 - 00:07 | 3628692 RockyRacoon
RockyRacoon's picture

It will force investors to think...

Ha!  That's a good one, Zero.   Ain't gonna happen until the money is GONE.  Then all "thought" will be where to place blame and seek legal recourse -- which ain't gonna happen either.   You think the average "investor" thinks?

The humor is flowing heavy here.

Wed, 06/05/2013 - 21:23 | 3628289 medium giraffe
medium giraffe's picture

Will this not have preciscely the opposite effect of what they are hoping to acheive? Damn right it'll kill investor interest, then where will the money go?  With flailing home markets, well, straight overseas, into foreign markets and tax havens, no?

So now with a large amount of consumer and industrial goods being imported, and therefore inflation being imported whilst profits are exported, you now want to send even more money into the hands of foriegn rivals, who, let's remember, 'we're being all protectionist about' with trade tarrifs and moaning about China flooding the market and so on. 

Sorry America, but are you fucking mental?

Wed, 06/05/2013 - 21:26 | 3628300 AynRandFan
AynRandFan's picture

The financial markets would be thrown into chaos, for starters.

This just confirms my worst fears.  I thought it was only the Fed that was run by megalomaniacs.  Obviously nobody wants their money in an illiquid money market account.

Wed, 06/05/2013 - 21:36 | 3628324 fonzannoon
fonzannoon's picture

what percentage of the muppets will ever get a whiff of this?

Wed, 06/05/2013 - 23:49 | 3628652 knukles
knukles's picture

Betcha every MMF holder will get some notification by mail and will make the news...
This will not be silent.

Example:  Notice one of the proposals allows the frozen $1 NAV to remain if max withdrawal is <$1MM.
I sure a s shit would advertise my fund limiting withdrawals to less than $1MM "especially for Ma and Pa Kettle in Albuquerque", the fund of the "99% Little People", etc.

It can be gamed and played.
Well.

Wed, 06/05/2013 - 21:22 | 3628297 Mr. Hudson
Mr. Hudson's picture

Great article. I guess I will have to make some adjustments to my portfolio.

Wed, 06/05/2013 - 21:24 | 3628298 Downtoolong
Downtoolong's picture

Um, I just thought I should let all you government regulators know that while you spent the last year and God knows how many taxpayer dollars trying to come up with penalties and disincentives to discourage me from pulling my money out of money market funds, I already did it. You'll probably also be happy to know that I bought precious metals with some of it. Relax Gary Gensler, I'm talking real physical, so you can't be held accountable for my escape.

 

Wed, 06/05/2013 - 21:26 | 3628303 Yen Cross
Yen Cross's picture

  Thank goodness for propane Barbecues.

Wed, 06/05/2013 - 21:38 | 3628327 Yes_Questions
Yes_Questions's picture

 

 

OK, Whats floating dead in that pool in your avatar?

 

;

Wed, 06/05/2013 - 21:35 | 3628322 Bob Sacamano
Bob Sacamano's picture

Limits on pulling money out of stocks (via circuit breakers).  Limits on pulling money out of money market funds.   Controls on physical PMs are coming.

Wed, 06/05/2013 - 21:41 | 3628336 medium giraffe
medium giraffe's picture

Sounds like.  Then what?  Are they going to be satisfied with that level of control, or, like an addict, are they going to want more control, and more control, and yet more control? 

Before you know it, your neighbours will be watching your every move and reporting any minor transgressions 'for the good of the country'. 

Full fascist lockdown in the land of the free. 

God, it's frightening to even contemplate how close that reality is now.

 

Wed, 06/05/2013 - 22:58 | 3628540 dogbreath
dogbreath's picture

I think  its more subtle.  every country is changeing the laws, rules, and regulations to put the common man under increasing stress/frustration.  This can also act a a distraction or lead to excessive self medication.  Like the olive oil thing in europe or the new laws in  turkey.   Voila you have civic unrest and they will be labeled hooligans or worse.  Of course this means larger law enforcement budgets with increasing goons in your face.   when the gates snap shut look out.

Wed, 06/05/2013 - 23:59 | 3628674 tsx500
tsx500's picture

Turkey = USA in 3 . . . 2 . . . 1 . . . .

Wed, 06/05/2013 - 21:35 | 3628323 20834A
20834A's picture

And if you can pull your money out of your 401k, you get hit with a 30% tax bite. Government win-win. Citizen lose-lose.

Wed, 06/05/2013 - 22:09 | 3628413 Things that go bump
Things that go bump's picture

Think of it as better than nothing.

Wed, 06/05/2013 - 22:22 | 3628444 ImReady
ImReady's picture

I'm thinking it may just be the best 30% hit I ever took. Couldn't it be a 100% hit if you do nothing? Or if they lock you out and wont let you have YOUR money, just whose money is it at that point?

Wed, 06/05/2013 - 23:51 | 3628659 knukles
knukles's picture

Why in God's name would they ever Bother do that when Benny will print all the fresh new bucks they want?
Why piss anybody off?
Ben prints the money for the kited checks!

Thu, 06/06/2013 - 00:00 | 3628677 tsx500
tsx500's picture

Citizen win-win in the long-long run !

Wed, 06/05/2013 - 21:36 | 3628325 20834A
20834A's picture

Diabolical moosecocks.

Wed, 06/05/2013 - 21:39 | 3628328 tom a taxpayer
tom a taxpayer's picture

This government scandal now has a name: Redemptiongate.

Wed, 06/05/2013 - 21:39 | 3628331 22winmag
22winmag's picture

We have ways of making you talk... err... broke.

Wed, 06/05/2013 - 21:39 | 3628332 pragmatic hobo
pragmatic hobo's picture

had elliot spitzer stayed on as NY governer perhaps the things would been very different ...

Wed, 06/05/2013 - 21:44 | 3628347 Bear
Bear's picture

Spitzer is no weiner

Wed, 06/05/2013 - 22:22 | 3628433 Yen Cross
Yen Cross's picture

     I know you're a wave guy Bear.

  Or we can go Ichi? (not) 

Wed, 06/05/2013 - 22:56 | 3628532 Bear
Bear's picture

I never cross my yens ... and I do keep them to myself

Wed, 06/05/2013 - 23:40 | 3628627 Yen Cross
Yen Cross's picture

    Bear, You have to admit, this Aussie thing is a bit over done.

Thu, 06/06/2013 - 00:40 | 3628757 My Days Are Get...
My Days Are Getting Fewer's picture

ES was politically assassinated.  Those in control had to get rid of him.

Wed, 06/05/2013 - 21:44 | 3628345 bankonzhongguo
bankonzhongguo's picture

They are just positioning that money pool to recapitalize the failing banks (again).

Wait for the next AIG or Lehman.

They can make that happen anytime they want.

SAC is just the latest trial balloon of what can happen to any fund based upon fear and panic.

They will seize the money market and force those investors to buy banks just like hapless Cyprus depositors.

Just goes to show - never let someone else manage your money passively.

 

Wed, 06/05/2013 - 21:45 | 3628351 seek
seek's picture

I'd cashed out my IRA MM right after 2008, and only had a pittance left in a normal MM account, and when zerohedge first reported the controls so long ago, that was all I needed to flush that account out as well.

Of course, quite a few bank checking/savings accounts are actually moneymarkets in disguise, so I think this goes beyond chasing dollars out of someone's 401K or Schwab account, and is in fact what Tyler indicates: a stealthy way to lock down bank deposits.

As I said before, they're locking the exits.

 

Thu, 06/06/2013 - 06:00 | 3629002 Urban Redneck
Urban Redneck's picture

MMF and MMA are different- while systemically there is overlap (particularly in the back office), with a MMA the contract governing withdrawals is between the depositor and the bank, so the bank has a contractual obligation with the customer regardless of any constraints on whatever MMF the bank turns arounds and parks the deposits in- but right now there are probably a bunch of bank general counsels figuring out how much leeway they have under Reg D to redraft the terms of their deposit agreements to chain that door too.

Wed, 06/05/2013 - 22:06 | 3628408 Professorlocknload
Professorlocknload's picture

Looks to me like this is their way of opening the gate to breaking the buck in these funds, in a crisis. Last time they had to underwrite them with FDIC backing. Next time around, they'll let them fall under $1 par. Voila, off the hook!

Had a new kid at the "Really-Big-Bank" promise me I couldn't lose money in a "Money Market Savings Account" after I asked him what if they broke the buck.  Handed him my pen and told him to write that down. He refused.

Get out yesterday!

 

Wed, 06/05/2013 - 22:24 | 3628448 razorthin
razorthin's picture

I'm thinking the only non-physical option left is mutual whole life insurance.  Are they going to fuck with that too?

Wed, 06/05/2013 - 22:30 | 3628465 sgorem
sgorem's picture

try a million dollar TERM LIFE, and go down with your gold and silver in a boating accident;)

Wed, 06/05/2013 - 22:43 | 3628495 Professorlocknload
Professorlocknload's picture

I'm with ya, but I don't think there are ANY non physical options here. Paper just burns, that's all.

Wed, 06/05/2013 - 22:24 | 3628449 Catullus
Catullus's picture

NSA collecting the metadata on all phone calls on the Verizon network

http://www.guardian.co.uk/world/2013/jun/06/nsa-phone-records-verizon-co...

Criminals. Including the telecom companies.

Wed, 06/05/2013 - 23:42 | 3628632 seek
seek's picture

I won't put much effort in defending the telecoms, but the fact this order exists (and I suspect was leaked) tends to indicate they were fighting it, so at least there's that.

Don't forget Qwest's CEO fought the spy orders hard, and the Feds smacked him down pretty good once that happened:

https://www.eff.org/deeplinks/2007/10/qwest-ceo-nsa-punished-qwest-refus...

Thu, 06/06/2013 - 00:39 | 3628753 Cobra
Cobra's picture

They say it's like looking at the outside of an envelope... That would imply that they know EXACTLY who you are. And with the GPS chip - WHERE you are. That's a LOT of control being exhibited! - They can't allegedly listen to your call, but with that other info just provided they could probably watch you from a drone with a directional mic on it. - No shit...

Thu, 06/06/2013 - 02:30 | 3628879 Catullus
Catullus's picture

If they can obtain the records, they can lie about it too. Which means they can place you at a scene of a crime without you knowing it. Do you think you can obtain your own metadata?

Wed, 06/05/2013 - 22:24 | 3628451 sgorem
sgorem's picture

wtf? cash the mf out if you can. load up on pre '64 us silver coinage, gold american 24karat gold buffalos, small denomination 24k gold bars/ingots, ie. 1, 2, 2.5, & 5grams for use as trade and barter/purchase when this greatest fraud and theft the world has ever seen comes to a conclusion. if it ain't nailed down, the us government and/or wall street will rip it from you and your family. it may be amusing to some, but they don't give a fuck about you or your families survival. that's where we're at folks. take it, or they'll take it all before it's over with. the writings on the wall, has been for years now. good luck.

Wed, 06/05/2013 - 22:26 | 3628452 Yen Cross
Yen Cross's picture

 Be careful for what you ask for.

Wed, 06/05/2013 - 22:32 | 3628470 Thomas Jefferson
Thomas Jefferson's picture

I have to say that all this is very disconcerting even though I have been aware that this was coming for years now.  Just got done reading the BIS article regarding the plan for recapitalizating TBTF banks.  The gates are indeed being shut.  I have little faith that the secured deposits will be actually insured.  I suppose it all depends on the severity of the pending crisis.  Sinclair is pleading with people to "exit the system."  According to Sinclair the potential loss equation is the OTC derivative loss (potentially 1 quadrillion) - bank capital (a few billion) - unsecured credit.  The numbers just dont add up.

Sh_ts about to get real folks.

Wed, 06/05/2013 - 23:50 | 3628657 WAMO556
WAMO556's picture

Your currency or your life.

Take a pick!

Thu, 06/06/2013 - 06:15 | 3629019 Urban Redneck
Urban Redneck's picture

Read Joe Biden's 2005 bankruptcy reform, in addition to making student loan debt non-dischargeable through bankruptcy and thereby legalizing debt slavery, the law modified the creditor hierarchy (in the US) that the BIS loves to talk about respecting in their paper- so the uninsured depositor's claim is legally subordinate to the the banks share of the 1+ quadrillion claims since 2005.

The numbers do add up, there just won't be anything left for the depositors after the write downs required to settle claims amongst the TBTF derivative holders.

So yeah, GTFO

Wed, 06/05/2013 - 22:34 | 3628472 tao400
tao400's picture

All i can say is wow. Maybe Sinclair is right, get out of the system. I followed him since 2002 and started buying gold becuase of him but lately have thought he was way over the edge. Remember when he was getting everyone to get the stock certificate in their hands because it was all going to blow up. Ha, ha. It was such a hassle i didn't do it. Now he is saying pay the tax on the retirement fund and take all the money out of the banks and put it where? I guess in a giant safe that is buried in a hole in the ground. Who knows. Now i read this kind of shit and it is like something is really imminent, especially with what the Japanese are doing with the money printing and Germany is hinting it will too. It's like the whole thing is hanging by a thread and they can't print fast enough to keep it going.

Wed, 06/05/2013 - 23:04 | 3628556 Thomas Jefferson
Thomas Jefferson's picture

I concur.  Sinclair has for the past year seemed over the top to me as well.  The devil is in the details.  If you pay attention to the articles being released by the BIS, IMF via Reuters no less one can see the writing on the wall.  Perhaps Sinclair is way ahead of the pack.  It would be unfortunate for me if I get trapped knowing dam well in advance that I should get out.  Getting out isn't as easy as he makes it seem.  Small businesses have to keep large balances for payroll, taxes, etc.

Wed, 06/05/2013 - 23:14 | 3628575 tao400
tao400's picture

I am in the same boat with the small business. It does seem, doesn't it, that what he is saying is going to happen is going to happen as per the articles you cited. It's crazy. Why would they be doing all these things right now if everything is under control? If there are not issues, why even mess with the money markets. Some could argue to be prepared. But in my business, when things are going along good why would I be putting in measures to prepare for the worst possible scenario. I only would do that when things look like they are going to get bad. That's why he might be right. This kind of thing is crazy. Your money isn't your money in the bank, in the mm you can't get it out if you want. What's a person to do. i have some real estate and gold and the 1/4 in cash and some stocks. I truly don't know what else to do.

Wed, 06/05/2013 - 23:49 | 3628654 WAMO556
WAMO556's picture

Your on the right path!

Now... The question is...

How do you survive with millions of others who are competing for the same thing? Think Sarajevo 1992-95.

Thu, 06/06/2013 - 06:29 | 3629030 Urban Redneck
Urban Redneck's picture

Invest the time get a plane ticket ($ cheap in the US) to his next meeting and ask him yourself.

 

 

Neither problem is inherently difficult to overcome.

 

Thu, 06/06/2013 - 07:11 | 3629080 Urban Redneck
Urban Redneck's picture

Invest the time.   (Just because it is worth repeating)

Thu, 06/06/2013 - 00:36 | 3628742 My Days Are Get...
My Days Are Getting Fewer's picture

Sinclair is the only person I really believe after Jesse.  Sinclair has prodded me into action.  I think he is "not over the top".  He is forward in time.  He visualizes the future.  Yes, his is free advice.  But, he gets no fees from his followers.  His message is one of survival.  It has no resonance with those who game the system.

I have most of my electronic assets with Vanguard.  I thought I was safe there.  Now, I am further in doubt.  I have not come to the point of exiting the electronic financial system.  But, I think of doing that almost every day.  I keep asking myself:  What do I have to gain by staying in it.  I do not trade anymore.  It is midnight now - I will pull more out tomorrow morning.

Do NOT follow this link or you will be banned from the site!