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Why This Harvard Economist Is Pulling All His Money From Bank Of America
A classicial economist... and Harvard professor... preaching to the world that one's money is not safe in the US banking system due to Ben Bernanke's actions? And putting his withdrawal slip where his mouth is and pulling $1 million out of Bank America? Say it isn't so...
From Terry Burnham, former Harvard economics professor, author of “Mean Genes” and “Mean Markets and Lizard Brains,” provocative poster on this page and long-time critic of the Federal Reserve, argues that the Fed’s efforts to strengthen America’s banks have perversely weakened them. First posted in PBS.
Is your money safe at the bank? An economist says ‘no’ and withdraws his
Last week I had over $1,000,000 in a checking account at Bank of America. Next week, I will have $10,000.
Why am I getting in line to take my money out of Bank of America? Because of Ben Bernanke and Janet Yellen, who officially begins her term as chairwoman on Feb. 1.
Before I explain, let me disclose that I have been a stopped clock of criticism of the Federal Reserve for half a decade. That’s because I believe that when the Fed intervenes in markets, it has two effects — both negative. First, it decreases overall wealth by distorting markets and causing bad investment decisions. Second, the members of the Fed become reverse Robin Hoods as they take from the poor (and unsophisticated) investors and give to the rich (and politically connected). These effects have been noticed; a Gallup poll taken in the last few days reports that only the richest Americans support the Fed. (See the table.)
Why do I risk starting a run on Bank of America by withdrawing my money and presuming that many fellow depositors will read this and rush to withdraw too? Because they pay me zero interest. Thus, even an infinitesimal chance Bank of America will not repay me in full, whenever I ask, switches the cost-benefit conclusion from stay to flee.
Let me explain: Currently, I receive zero dollars in interest on my $1,000,000. The reason I had the money in Bank of America was to keep it safe. However, the potential cost to keeping my money in Bank of America is that the bank may be unwilling or unable to return my money.
They will not be able to return my money if:
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Many other depositors like you get in line before me. Banks today promise everyone that they can have their money back instantaneously, but the bank does
not actually have enough money to pay everyone at once because they have lent most of it out to other people — 90 percent or more. Thus, banks are always at risk for runs where the depositors at the front of the line get their money back, but the depositors at the back of the line do not. Consider this image from a fully insured U.S. bank, IndyMac in California, just five years ago. -
Some of the investments of Bank of America go bust. Because Bank of America has loaned out the vast majority of depositors’ money, if even a small percentage of its loans go bust, the firm is at risk for bankruptcy. Leverage, combined with some bad investments, caused the failure of Lehman Brothers in 2008 and would have caused the failure of Bank of America, AIG, Goldman Sachs, Morgan Stanley, Merrill Lynch, Bear Stearns, and many more institutions in 2008 had the government not bailed them out.
In recent days, the chances for trouble at Bank of America have become more salient because of woes in the emerging markets, particularly Argentina, Turkey, Russia and China. The emerging market fears caused the Dow Jones Industrial Average to lose more than 500 points over the last week.
Returning to my money now entrusted to Bank of America, market turmoil reminded me that this particular trustee is simply not safe. Or not safe enough, given the fact that safety is the reason I put the money there at all. The market turmoil could threaten “BofA” with bankruptcy today as it did in 2008, and as banks have experienced again and again over time.
If the chance that Bank of America will not return my money is, say, a mere 1 percent, then the expected cost to me is 1 percent of my million, or $10,000. That far exceeds the interest I receive, which, I hardly need remind depositors out there, is a cool $0. Even a 0.1 percent chance of loss has an expected cost to me of $1,000. Bank of America pays me the zero interest rate because the Federal Reserve has set interest rates to zero. Thus my incentive to leave at the first whiff of instability.
Surely, you say, the federal government is going to keep its promises, at least on insured deposits. Yes, the Federal Government (via the FDIC) insures deposits in most institutions up to $250,000. But there is a problem with this insurance. The FDIC currently has far less money in its fund than it has insured deposits: as of Sept. 1, about $41 billion in reserve against $6 trillion in insured deposits. (There are over $9 trillion on deposit at U.S. banks, by the way, so more than $3 trillion in deposits is completely uninsured.)
It’s true, of course, that when the FDIC fund risks running dry, as it did in 2009, it can go back to other parts of the federal government for help. I expect those other parts will make the utmost efforts to oblige. But consider the possibility that they may be in crisis at the very same time, for the very same reasons, or that it might take some time to get approval. Remember that Congress voted against the TARP bailout in 2008 before it relented and finally voted for the bailout.
Thus, even insured depositors risk loss and/or delay in recovering their funds. In most time periods, these risks are balanced against the reward of getting interest. Not so long ago, Bank of America would have paid me $1,000 a week in interest on my million dollars. If I were getting $1,000 a week, I might bear the risks of delay and default. However, today I am receiving $0.
So my cash is leaving Bank of America.
But if Bank of America is not safe, you must be wondering, where can you and I put our money? No path is without risk, but here are a few options.
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Keep some cash at home, though admittedly this runs the risk of loss or setting yourself up as a target for criminals.
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Put some cash in a safety box. There is an urban myth that this is illegal; my understanding is that cash in a safety box is legal. However, I can imagine scenarios where capital controls are placed on safety deposit box withdrawals. And suppose the bank is shut down and you can’t get to the box?
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Pay your debts. You don’t need to be Suze Orman to know that you need liquidity, so do not use all your cash to pay debts. However, you can use some surplus, should you have any.
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Prepay your taxes and some other obligations. Subject to the same caveat about liquidity, pay ahead. Make sure you only pay safe entities. Your local government is not going away, even in a depression, so, for example, you can prepay property taxes. (I would check with a tax accountant on the implications, however.)
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Find a safer bank. Some local, smaller banks are much safer than the “too-big-to-fail banks.” After its mistake of letting Lehman fail, the government has learned that it must try to save giant institutions. However, the government may not be able to save all failing institutions immediately and simultaneously in a crisis. Thus, depositors in big banks face delays and defaults in the event of a true crisis. (It is important to find the right small bank; I believe all big banks are fragile, while some small banks are robust.)
Someone should start a bank (or maybe someone has) that charges (rather than pays) interest and does not make loans. Such a bank would be a good example of how Fed actions create unintended outcomes that defeat their goals. The Fed wants to stimulate lending, but an anti-lending bank could be quite successful. I would be a customer.
(Interestingly, there was a famous anti-lending bank and it was also a “BofA” — the Bank of Amsterdam, founded in 1609. The Dutch BofA charged customers for safe-keeping, did not make loans and did not allow depositors to get their money out immediately. Adam Smith discusses this BofA favorably in his “Wealth of Nations,” published in 1776. Unfortunately — and unbeknownst to Smith — the Bank of Amsterdam had starting secretly making risky loans to ventures in the East Indies and other areas, just like any other bank. When these risky ventures failed, so did the BofA.)
My point is that the Federal Reserve’s actions have myriad, unanticipated, negative consequences. Over the last week, we saw the impact on the emerging markets. The Fed had created $3 trillion of new money in the last five-plus years — three times more than in its entire prior history. A big chunk of that $3 trillion found its way, via private investors and institutions, into risky, emerging markets.
Now that the Fed is reducing (“tapering”) its new money creation (now down to $65 billion a month, or $780 billion a year, as of Wednesday’s announcement), investments are flowing out of risky areas. Some of these countries are facing absolute crises, with Argentina’s currency plummeting by more than 20 percent in under one month. That means investments in Argentina are worth 20 percent less in dollar terms than they were a month ago, even if they held their price in Pesos.
The Fed did not plan to impoverish investors by inducing them to buy overpriced Argentinian investments, of course, but that is one of the costly consequences of its actions. If you lost money in emerging markets over the last week, at one level, it is your responsibility. However, it is not crazy for you to blame the Fed for creating volatile prices that made investing more difficult.
Similarly, if you bought gold at the peak of almost $2,000 per ounce, you have lost one-third of your money; you share the blame for your golden losses with Alan Greenspan, Ben Bernanke and Janet Yellen. They removed the opportunities for safe investments and forced those with liquid assets to scramble for what safety they thought they could find. Furthermore, the uncertainty caused by the Fed has caused many assets to swing wildly in value, creating winners and losers.
The Fed played a role in the recent emerging markets turmoil. Next week, they will cause another crisis somewhere else. Eventually, the absurd effort to create wealth through monetary policy will unravel in the U.S. as it has every other time it has been tried from Weimar Germany to Robert Mugabe’s Zimbabwe.
Even after the Fed created the housing problems, we would have been better of with a small 2009 depression rather than the larger depression that lies ahead. See my Making Sen$e posts “The Stockholm Syndrome and Printing Money” and “Ben Bernanke as Easter Bunny: Why the Fed Can’t Prevent the Coming Crash” for the details of my argument.
Ever since Alan Greenspan intervened to save the stock market on Oct. 20, 1987, the Fed has sought to cushion every financial blow by adding liquidity. The trouble with trying to make the world safe for stupidity is that it creates fragility.
Bank of America and other big banks are fragile — and vulnerable to bank runs — because the Fed has set interest rates to zero. If a run gathers momentum, the government will take steps to stem it. But I am convinced they have limited ammunition and unlimited problems.
What is the solution? For you, save yourself and your family. For the system, revamp the Federal Reserve. The simplest first step would be to end the dual mandate of price stability and full employment. Price stability is enough. I favor rules over intervention. We don’t need a maestro conducting monetary policy; we need a system that promotes stability and allows people (not printing presses) to make us richer.
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Fiat money doesn't spur misallocation. Blasphemy.
Why This Bronx Hooligan Is Pulling Out A Harvard Economist's Fingernails
"Well, it's quite simple really", he said, "he wrote a mainstream article telling us all that he had $1,000,000 in a checking account that he'd recently withdrawn from B of A. I went on a hunch. A couple hunches, actually. First, that that million dollars was likely more than the average taxi driver carries, and second, that being a Harvard professor that he was probably a pussy who, for all he knew, thought it might be a dandy idear to tell everybody that he's got all this money and he ain't gonna leave 'er in the bank. I didn't think it would take more'n one or two fingerna...."
It's pretty rare that I literally laugh out loud to a comment, but you got me with that one. Good shit.
"thought it might be a dandy idear"
Tip of the hat to you Sir for recovering a missing Boston 'r' and placing it where locals only dare to tread.
Ignatius that had to be one of the funniest comments on ZH to date. It brightened my mood thanks :)
I was commenting yesterday on Charles Hugh Smith's (weak) argument about theft causing deflation to keep your mouth shut these days on any large deals brought in, big quarters etc and appear poor. I also stated owning tangible assets is the only real investing choice at this time and that in any investment now to do cherry picking with lots of due diligence.
Reflation did lift all boats in the stock market but levitation in the manner conducted is temporal. So this gent was an index investor type. And as several other astute commentators already mentioned what was he doing with a million in the bank earning 0 interest in the first place?
RE and gold are about it for the safer investments at this time. The now occurring market correction had to be one of the most anticipated I have ever seen. Im doing RE now and looking at 2016 for a year I believe most of the dust has settled and looking at stocks again.
Money could have been better spent investing in projects that return a positive ROI.
And right now that would be?.
Curious as to why someone with a million is earning zero on it.
Risk.
I'll give you a hint, there are likely a few millionaires on ZH that are actually down 20-30% in their net worth in nominal USD terms, because they're avoiding risk and put their money into the only risk-free investment in existence.
risk-free investment = Irish whiskey
A drink in each hand = Irish Handcuffs
<smirk>
Absofuckinglutely
On the plus side, maybe he is getting free checking?#@&??
A new toaster perhaps? Remeber those days?
Spiderman towels are all the rage these days! :>D
a millio is the entry price to most community bank start ups.....and they return 7-8%+....
Maybe because he has seven million dollars in other diversified investments.
He is smart. All of your gains in stocks and real estate will crash to near zero when the shit goes down. He will still have one million dollars.
@Bangin7GramRocks
What's a million fiat dollars gonna buy if GS, BAC, JPM et al are tits up? Brother, if that happens, we will definitely be long soup lines. When the proverbial "shit" does go down, the USD is going down with it.
but will they be of any use in the culmination of this collapse?
when the SHTF again, will paying bills be a priority? there's a strange connection to "normal" when discussing a situation where nothing is and when normal fails for the final time, dollars will be the least of anyone's concern.
the fuckers in charge of the "money" have assured its uselessness, why would I devote energy to accumulate it?
If you think there will be a crush for cash, do you think those that hold our debt will not be doing the same? Calling every fucking note they can collect on...you betcha.
And everyone knows it.
He is an economist.
Is this the beginning of the end?? Should I hit panic mode??
Dude. This is economics talk. Its panic 24/7.
Simple Hyperventilating means you are relaxed.
Dude. This is economics talk. Its panic 24/7.
Simple Hyperventilating means you are relaxed.
get a paper bag, dude.
There's been a run on paper bags ever since Yellen "won" the nomination.
Those are to vomit in
And to cover her head while she's sticking her cock in our asses. Can't be too safe. There may be a mirror or something around.
You certainly don't want to turn your head around and look at her, you might turn to stone.
When you look in the eyes of the Yellen, you turn to Paper.
Or ashes lol spontaneous combustion from peering into the darkness. About those FDIC deposits I seem to recall that BOA stuffed $75 Trillion of Derivatives onto the taxpayers by way of the FDIC but I have no clue if they are still in there - anyone know?
Just throw some water on her, she will melt.
Nah, hit the bong instead. And keep stacking.
Already stacked. Now I just need a decent reefer stash for post-collapse world.
The Fed did not plan to impoverish investors by inducing them to buy overpriced Argentinian investments, of course, but that is one of the costly consequences of its actions. If you lost money in emerging markets over the last week, at one level, it is your responsibility. However, it is not crazy for you to blame the Fed for creating volatile prices that made investing more difficult.
Okay so it was fine when the FED QE'd the shit out of the markets in the first place instead of letting natural market force corrective measures sort out it at the expense of destroy any semblance of fundamentals in the process.
What a DAP (dum ass professor) , confusing currency and money.
Your real issue is your currency is backed by rainbows and skittles, and it matters not where you physically keep it, as worthless it will become soon...
Kick Ass Marshawn! Go Seahawks!
Fuck the Seahawks, Omaha, Omaha, Omaha !!!
3 picks for Manning and 27-21 Hawks.....
The Chargers took him for six picks in Indy once and had nowhere near the personnel of Seattle. The green slime will be all over Manning on Sunday and the picks will fly.....
I don't give a fuck who wins as long as the beer is cold and the chilli is hot... oh, and the Seahawks final score ends in a 8 and the Broncs' end in a 7. USA! USA!
I wager that omaha wins this thing in less than 9 innings !!!
On Bovado the prop bet for manning picks is under/ over a 1/2 and the over is.-180.
That seems to easy .
Vegas knows and they are going to suck in a lot of people.
The contrarian side of my brain just went off
I am going to go out on a limb and take the vegas side and say it will be zero.
i'm just saying.
I too am hoping that the FEMA region X team will defeat the FEMA region VIII team in the upcoming 48th annual munus.
And may Sherman teach Manning a lesson in humility.
LOL, now thats funny, I don't care who you are !!!
Richard Sherman 'dont call me Dick" will end up shaving them locks in embarassment.
Manning gonna scissor that boy.
There always has to be a first time. However because they are so afraid of him (like the rest of the NFL) it is not likely the ball will ever be thrown near him. Better bet on Zero getting another Peace prize than against the Legion of Boom!
What kind of idiot has a million dollars in a checking account?
An academic economist.
The same kind that wants to "revamp" the Fed.
Turbocharge that bitch.
Oh hey, wait.
>> has a million dollars in a checking account?
Idiot? He's 25% better off this year than if he'd had a million dollars in gold. If he'd had a million in gold he'd have been a hero on here. Who's the idiot? I'd have certainly been a lot better off if I'd been all cash the last two years of so.
he didn't say how much he had in other investments, now did he? most wealthy people only keep enough in checking to pay the bills.
but - he did at least try to say some truth. i moved my parents money out of bank of america long ago, to a bank without 50 trillion in derivative cds bets.
the depositors are SECOND to the owners of the cds bets.
it will be a long time before bennie can print 50 trillion.
Shhhhhh. What if he reads this and decides to show off and prove you wrong.....
He did say he went to/taught at Harvard. Does that answer your question?
A Harvard idiot did you ever see what Summer's did to Harvard's finances?
Larry Summers and The Financial Crisis at Harvard
Harvard Derivatives Whiz Fired For Emailing Larry Summers About "Frightening" Trades?
A very rich one.
A fool who wants to "prepay" taxes.
Put your money in durable goods, inventory if you can, gold, silver, ammo, and starve the beast.
In a financial collapse the one entity that will remain (like cockroaches) is government and the one debt that will not be forgiven is taxes (the last debt to be forgiven) so if you want to stay in your home and out of IRS fEMA prison, and you think your assets will be fozen or Corzined, then hell yes prepay them. If you plan on going rogue, then prepay for nothing but ammo.
Fonestar, ... what would he do?
The same kind of idiot that just told the world he has a ton of cash sitting around his home somewhere.
Even if it all is in a safety deposit box, someome could take his family hostage and start cutting off parts until the money shows up...
"What kind of idiot has a million dollars in a checking account?"
Prolly a happy one.
I wish this idiot had a million bucks in a checking account...
An academic! An ivy League one. That's what kind of idiot! This fucktard forgot option #6 - take your million and buy a fuckload of silver and gold. At least he figured out that BoA is eventually DOA and fiat money sucks a dick covered in herpes blisters.
Yeh he should have invested in the ponzi scheme...and just got out at the top... no risk there. /
Except for maybe the hottub, the private plane, the Mercedes, the Porsche, the 9th story terrace, or the 4 ft fence.
I suggest a working cash allocation of 1/3 in local bank, 1/3 in local credit union, 1/3 in mattress. If one goes down the other will probably keep you solvent until the crisis passes. This applies to normal bill paying money, not long term wealth preservation or doomsday prep, etc....
I suggest a working cash allocation of 1/3 in racetrack parimutuels, 1/3 in lottery tickets, 1/3 in three card monte operators.
The real Henry (Buk, as in Puk) Chinaski would put one third in beer, one third in wine, one third in hard liquor.
Did this mofo just suggest that prepaying my taxes would be a good use of part of my hypothetical millon bucks in BoA? LMFAO!!! Harvard? Really? I can't believe suggestion #6 wasn't to sell my kids and invest the proceeds in a MYRA.....never trust an economist especially if he admits to having a million in a checking account....
He was just saying that cause he didn't want to get suicided. He already went against the FED and the Bankster BOFA
He is doing exactly what the FED wants him to do. Creating false panic so they have more room to print. What an asshole!
Please. I took ALL mine out of BoA in 2009 and I didn't even go to Haavaad.
dude should put it into the harvard endowment where it will be safe. [/sarc.]
Gold, bitch.
In your hand, of course.
Cheeky humor, or another Risk Mitigator, who averted paper risk, put it (all?) in a certain "risk-free" asset, and saw said asset lose 20-30% of its value? ;-)
I think we've all learned that front-running the Fed & Friends (GS, JPM) is a bit harder than most realized.
+1
For...
I think we've all learned that front-running the Fed & Friends (GS, JPM) is a bit harder than most realized. --Kirk2NCC1701
Amen.
"The Fed did not plan to impoverish investors by inducing them to buy overpriced Argentinian investments..."
Who is their right mind would invest in Argentina? Going back to Juan Peron, they've been like heroin addicts shooting up socialist smack, hitting rock bottom, swearing to clean themselves up, and a few years later go right back to mainlining. Again and again. Anybody who invests there deserves to lose their money.
VIVA Argentina!
"Who on their right mind would invest in Argentina..."
That's an easy one. People who are close to the throne, and are able to gamble on whatever they want with interest free Bennie bux, knowing they will be made whole again by said throne if it all goes to shit, and get a nice bonus to boot. People who suffer no consequences for being wrong.
"Who is their right mind would invest in Argentina?"
uh.... Doug Casey?
Better air quality down there.
yep and if you are smart you will take all your money out of banks too
"Why This Harvard Economist Is Pulling All His Money From Bank Of America"
Better question: why didn't that Harvard economist pull all his money from BofA back in early 2009. If everyone had done that, the "Too Big to Fail" banks would have been forced to fail as they should have.
It must have been that 20 something derivative? Just guessing?
pro tip: a little gold or silver coinage won't hurt nobody...
and not just a former harvard professor, but also a former goldman sachs trader and biotech co. CFO....wooooo!!!!
This guy does not make any sense in what he does with his money. Hell....a million bucks stashed in annuity vehicle would earn him 3%. He can't figure that out?
I gave you a down arrow because an "annuity vehicle" has counter-party risk. You are depending on the entity that holds your annuity to payoff. That may, or may not happen.
Wanted to say thanks for explaining your down arrow. As I have stated before, it's interesting to find out why people disagree. And you made a great point.
10 y T-notes also pay nearly 3%. it is a question of how long you want to tie the money up. You have to go for at least 5 years to crack the 1% mark.
"Hell....a million bucks stashed in annuity vehicle would earn him 3%."
Ugh! Annunities are terrible investments. If the firm goes bust kiss all good-bye since there isn't enough insurance in the pool to cover loses. Annunities are invested like pensions, usually by investing in over-priced illiquid assets like reits because they promise decent yeild, but are impossible to liquidate without losing most of the principal during a crisis. Perhaps the reason why he's not investing in an annunity, is because he's an economist working for annunity firm! At least he was smart enough not to lose it in the housing bubble, and was smart enough to accumulated $1M!
Guy sells you an annuity, he gets a real nice payday. Where is that money coming from?
Just limit your bank deposits to 250K in any one institution. You can also use Treasury Direct and deposit your cash with the US Treasury in T-bills. T-bills pay slightly more than zero.
Treasury Direct??
Whoa... I get the heebie jeebies just reading those words in this environment.
LMAO if you believe the 250K insurance limit is going to be honored when this shit goes down.
At best, you'll have $250K of preferred shares in the bank your account was in, with a laundry list of limitations on what you can do with them. (Selling won't be on the list, wiping your ass with them might be.)
"LMAO if you believe the 250K insurance limit is going to be honored when this shit goes down."
Depends on how big a crisis. Assume that you divide $1M into four banks each with $250K and only one bank fails. The FDIC can cover the failure of a single bank. If All banks go bye-bye at the same time then your screwed. If its just in one bank, and you guess wrong and only that single bank fails the hes out $750K. Another issue is perhaps they might limit withdrawls per bank. Atleast he can withdraw four times if divided into 4 banks. Not purfect, but its has some advantages.
I am pretty sure when the banks start failure, the gov't will outlaw PMs and demand everyone turn it in. Yes, you can bury it and wait it out, but if all of your wealth is in PMs you not going to be able to spend it. Yes, there is the black market, but you never know who will turn you in for a gov't reward, or decide to try an home invasion if someone finds out you have PMs. Yes, maybe you have Guns, but really you want to remain below the radar and not become a target. When the big crisis happened everyone will get screwed over, no matter how much preps you have. You will feel pain when it happens. All you can do by prepping is to minimize the pain and risks. Have some cash, have PMs, Guns, ammo, food, fuel, etc. Have it all so you always have options.
All Igotta say is fuck that shit..so you're saying I should just kill myself now then? What's the point I'm even preparing then?
I stopped reading beyond that idiotic line. Just another "tard" that thinks he's living in reality.
"I'm from Harvard, and I'm here to help."
Thank god, somebody intelligent finally showed up to help.
Mr. Harvard, over here, grab the toilet brush and have a go at it, ole chap.
Sir, you hold it by the skinny end, not the bristled end.
There, you're getting the hang of it already ...
You got here just in time, the peep show just ended. Here's a mop and bucket, and you can use this paint scrapper to get the spots that are already dry and crusty.
And by "Harvard" you mean "Government"?
Siince most if not all .gov control freaks, queers, peds, psychs, and other forms of debauchery are bred in the bone at the elite "schools" only a few years after their mothers vomit them from their bodies, I assume you mean that school and .gov bred power hungry fuck ups are all the help we need?
Hey Rand... thought I'd try and give the issue a boost. Might have been too subltle, eh?
Just on a practical level, I went down to BAC to close an account and take my funds in the form of cash back when BAC started some insane charge for ATM use against the "little people" about 2 years ago. Remember that?
I was so mad I marched down to the bank (with a smattering of others) and demanded my money. It was a mini-run I think. The teller was nice. Called over the Supervisor, who got on the phone with the district manager. They tap danced around the whole thing and asked if it was OK if they only gave me $1,000. I wanted a little over $100,000.
They claimed they just did not have the money in the vault, but could order it and it would take a day. Rather than making a big production, I said, "fine," but had them write a brief script with the sup's name and my intention so when I came back the next day I would not have to reexplain myself.
the next day rolls around and guess what? The power was off for that city block - nowhere else in the city. So the bank was "closed." Dozens of people lined up outside as the staff huddled inside hiding from a zombie apocalypse. That day's attempt was aborted. No such thing as coincidence in my mind.
The next day rolls around and guess what? Nobody ever heard of me, nor has any money been order per my request.
So now is the time you start raising your voice in front of a line of other customers. I asked loudly if it was true that the bank did not have my money anymore - getting startled looks from people. Then I produce a copy of my note from the prior day and told them this was bullshit and that if they refused to make good on my demand that I would be talking to the OCC and the Fed. I asked for the branch number and the names of each person in the chain of command. That got their asses in gear.
It took over an hour, with all kinds of veiled threats about having to report everything to their security department, taking my passport, filing their CTR (SAR?) etc. They did everything to not part with my (their) money.
If you go this route, plan ahead - even a few days in advance. Get written confirmation about your cash order from a senior person(s) if you go that route.
As challenging as it all was, I am glad I took it in the form of cash rather than another cashiers check that is still trapped in the banking system.
Yes you get nervous about having that kind of money hanging around, but also good knowing if the ATM goes down you can still operate - If people still take cash.
I also took out all metal assets out of the safety deposit box too.
Only the paranoid survive.
Good luck to everyone.
"Yes you get nervous about having that kind of money hanging around, but also good knowing if the ATM goes down you can still operate - If people still take cash. I also took out all metal assets out of the safety deposit box too."
Where do you live again? /sarc Sorry I couldn't resist!
As I recall from your earlier post last year, you had an unfortunately accident after removing your captial from BAC, The Boat you boarded to return home struck a water buffalo and sank! You managed to swim to shore but, you were unable to save your cash and PMs. Such a terrible unforeen incident. I am truely sorry for your loss!
Took them a while to fire up the hard currency printer in the basement or Jason Bourne was busy whacking some African to get to you in a timely manner......
Fuck the overpaid, overpensioned, overbenefitted firemen and cops --- THIS man is an example of a true "hero"!
Alas, alas, 3 bank runs alas... just have to convince the bankster to give you back your $990k. And where to put it after that?
It's a mattering dilema.
Bet he didn't get in in cash, either.
Thanks. Interesting read. I have gone through the same with Chase on liquidating an inheritance.
Those scum with kill their parents for a days worth of interest....
Great Story, wether it's True or Not.. i withdrew 25k once and they literally Yawned. I at least expected a Supervisor to give me the Old SOft sell..
I call them Bank of Satan. I ended my banking with them at that same time. I still have some money in the system, but it dwindles by the month.
Good for you. About 2 years ago I commented on ZH how a bank wouldn't give me my settlement for a buyer's cash purchase of my property --- about $70K.
I even made sure to call a week in advance of closing to the manager of the closing attorney's branch bank to let them know my intentions and to make sure their cash truck would deliver enough cash for that week/day. That's the proper procedure for large amounts, otherwise they will definitely all be f'ing gobsmacked.
But it still didn't make any fucking difference and they all acted shocked.. Shocked! when I showed up with my request.
So I took as much cash as that branch would give me. I then made them call around to all the other branches in the metro area to find out how much cash they all had on hand for me. I then made my rounds until I got it all.
ZH trolls ragged on me for triggering the money police. Maybe those trolls have a history of only handling cash with black ski masks. Not me, so who cares? Muppet do what a muppet gotta do.
"Someone should start a bank (or maybe someone has) that charges (rather than pays) interest and does not make loans."
Umm, they did. They're called vaults, which house stores of wealth such as gold and silver.
The problem is that people want both safety and CONVENIENCE.
The OpEx structure of a fee-based depository PRECLUDES a branch network (beyond one or two branches per major urban center) as well as precluding an ATM network.
To some extent the debit cards and the internet (online bill payment and money transfer) mitigate this, but the psychological barriers to overcoming the perceived contradiction of branch-less alternative banking and increased depositor safety are a LARGE obstacle to successful implementation.
Who the phuck would have left a million in Bank of Ass in the first place? A Harvard PHD I guess.
ALTERNATIVE INVESTMENTS:
cash, gold, silver, dehydrated & canned food, guns, bullets, classic cars without black boxes priced $10k -$25k, farmland, tractors, log cabin/firewood, salt, whiskey/vodka/gin, butane lighters, condoms, cash, swords, Stabil, assorted knives, rope, first aid kits, water purifiers, reference books, sleeping bags & tents, non-motor boats, life jackets, non-spayed german shepherds, sleds, wagons, bicycles, glass jars, Ball jars, .........
http://www.bloomberg.com/news/print/2014-02-01/u-s-mint-gold-coin-sales-...
+42. One item missing.
Hint: cue fonestar...
Holy shit bro! You just named most everything I converted my Fed Reserve Notes to.
Before reading the article, I thought he was going to say something about his finding out (well after the fact) that the $75T in derivatives that BofA holds were now effectively backed by depositors.
http://seekingalpha.com/article/301260-bank-of-america-dumps-75-trillion...
Man I feel that this guy is going to commit suicide very soon!
Only God can create wealth. Says any monotheistic faith. Thus it's all bound to fail. #endthefed
It is probably not wise to listen to anyone who had $1,000,000 sitting idle in a *checking* account. More money than brains--which pretty much may describe most academic economists.
"Argentina’s currency plummeting by more than 20 percent in under one month"
Those holding USD there are happy
Month by month
Skank of America bank holding is so 2007....Think TARP and jew.. Mean Lew.
I think it was at Ann Barnhardt's blog that I read that the FDIC is tying insurance to your social security number so that there is a maximum $250,000 of insurance per person, no matter how many banks you have spread your money across. Any of you smart guys can confirm this?
P.S. Where has this letter writer mofo been? Welcome to the real world dude.
Yes, I belive that is the case now. That's been out there, so it's old news, but worth repeating.
The other shock news that came out about the same time was that Bank of America co-mingled about $1T of their liabilites onto the depositor (FDIC insured) side of the ledger. They un-segregated depositor money. Ben Bernanke strong-armed this action over Shiela Bair's (FDIC chair) vociferous objections. She quit shortly thereafter. That was >1 year ago.
Those actions tell anyone paying attention what is going to happen.
Things are getting a little weird, I was in my small local credit union yesterday to cash a check and I noticed a sign limiting withdraws to $5,000 in cash per day. They sign stated they needed enough cash for other customers. I suspect some people are going in with very large requests for cash. I have a significant amount of money in the credit union and it makes you wonder. People are apparently getting nervous.
are you going to withdrawal your total sum anytime soon? I'm nervous for you!
it took almost a week to withdraw 70k from my parents bank the last part of 2011. (this was shortly after finding ZH. I was in panic mode)
I wasn't planning on it, but the limit make me wonder....
The clown calls the failure of Lehmen a mistake?
It was the only thing done right.
Why would anyone keep 1 million in a checking account?
Because checking accounts are subject to reserve requirements. This differs from CD's etc.
https://en.wikipedia.org/wiki/Reserve_requirement
My Bet it was Chump Change for him.. I hope he came on here and read the Comments I am sure he would enjoy them :)
Why did he pull his money out? Probably to buy stock in facebook, which now has a market cap of 150 billion. Yes, I said billion.
Welp, at least I have no money for them to take! Benefits of being a millenial.
Monthly "QE" is aproximately equal to monthly social security payments. In other words, QE is fully funding social security payments.
This is interesting. A Harvard academic who admits how much money he has. It's indicative of how the Ivy League lives. It is interesting that he had his money in Bank of America. Before Bank of America came into existance, part of them was called Fleet Bank. One day I was listening to Howie Carr on AM 680 WRKO in Boston and he was doing a segment on people's experiences with banks in Boston. The people who were depositors with Fleet Bank were telling about how they were given the run around when they where trying to close out their accounts. The experiences ranges from fines assessed for unknown reasons or regulations that you thought could not exist. The point was that Fleet was doing their hardest to keep people in with them. They were taking measures that were apparently illegal and yet no one in the commonealth of Massachusetts did anything about it.
One more thing I would point out and that is I hope that Tyler will keep track of this guy. I do not want him to be the victim of TPTB in his criticism of the banking system and the Fed.
Good old Howie Carr. I'm surprised Whitey never had him whacked. I think he liked the notoriety he gave him. Amazing how dirty his brother was and what he got away with as the Speaker of the House.
Nobody ever said Harvard professors were stupid, just M'Fn traitors and globalist scum that would sell their grandmothers for a nickel.
This is exxactly what is needed:
When the FED and WS Banksters remove the hand of the markets, the people have ti rise up and smack the asshats with exactly that hand.
"We don’t need a maestro conducting monetary policy; we need a system that promotes stability and allows people (not printing presses) to make us richer."
And that could be done by an Excel spreadsheet
.....or by the Bitcoin blockchain ledger, distributed over the internet; governed horizontally by the totality of users, instead of by the same old, same old hierarchy which in turn is governed at the top by the Ownership.
what kind of person leaves a million clams in BofA ?