This page has been archived and commenting is disabled.

Are Your Savings Safe From Bail-Ins?

Tyler Durden's picture




 

Europe's banks are vulnerable in 2015 due to weak macroeconomic conditions, unfinished regulatory hurdles and the risk of bail-ins according to credit rating agencies.

 

 

The truth is that banks in most western nations are vulnerable to bail-ins in 2015 and the recent G20 meeting in Brisbane was a further move towards the stealth bail-in regimes.

More than seven years after the start of the financial crisis, banks have made strides towards improving financial stability but they are still struggling and pose risks.

 

The move by western nations towards bail-in regimes whereby “too big to fail” banks confiscate individual and companies' deposits has been put in place with very little public discussion or awareness of the risks and ramifications of bail-ins.

...

If bail-ins take place, which now seems almost certain when banks get into difficulty again, there is a very significant risk that bail-ins alone will lead to a collapse in consumer and business confidence as consumers and businesses see their savings and capital confiscated. This alone will likely compound a difficult economic environment and lead to sharp recessions and depressions - economic contagion.

There is also the financial contagion risk. Much of the bonds are held by pensions funds, institutions and even leveraged investors like hedge funds. If much of the loss-absorbing debt is held by leveraged investors then there is a risk of contagion across the financial system and the contagion boomerang back to banks.

Oh what a tangled web, we weave ...

Must-read guide and research on bail-ins here: Protecting Your Savings In The Coming Bail-In Era

*  *  *

Source: GoldCore

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Sun, 12/14/2014 - 22:07 | 5551966 unrulian
unrulian's picture

Canada shouldn't be on the safer list...Bail-ins for banks legislated in 2013, oil economy and housing bubble

Sun, 12/14/2014 - 22:07 | 5551971 Publicus
Publicus's picture

Are your gold/silver safe from confiscation?

Sun, 12/14/2014 - 22:11 | 5551983 cowdiddly
cowdiddly's picture

Yes, mine are. Molon labe

Sun, 12/14/2014 - 22:16 | 5551995 tgmur10
tgmur10's picture

Gold? Why would anyone bother with such a barbarous relic.....  hehehehe

Sun, 12/14/2014 - 22:30 | 5552029 Number 156
Number 156's picture

What if they confiscate gold coin and bullion?

Sun, 12/14/2014 - 22:35 | 5552045 The Wizard
The Wizard's picture

In order to confiscate it they need to know where it is located. I ain't tellin'.

How many people turned in gold in the 1933 confiscation scheme?

Sun, 12/14/2014 - 22:38 | 5552063 A Nanny Moose
A Nanny Moose's picture

Was lost in a tragic boating accident, along with my dog, Phoebe.

Mon, 12/15/2014 - 00:19 | 5552351 TruthInSunshine
TruthInSunshine's picture

Source: Goldcore

Fuck the completely biased shit articles FFS.

Zero Hedge is on a bender of "lower oil prices will destroy the world," and now, apparently, having 'Goldcore' (no bias/agenda there) preach the risks of bail ins.

Pravda comes to ZH.

Mon, 12/15/2014 - 02:02 | 5552546 Zoomorph
Zoomorph's picture

I rarely get further than the headlines on ZH (maybe 1 or 2 articles a day). I rarely see anything actually worth reading (maybe 1 or 2 a month).

ZH = a bunch of crap anti-gov, world is ending articles written by idiots or agenda pushers.

Mon, 12/15/2014 - 03:21 | 5552629 noben
noben's picture

Hmmm... can we conclude we won't hear from for a month or more?

Mon, 12/15/2014 - 11:11 | 5552774 giggler321
giggler321's picture

More like which snake hiss's the loudest.  Remember Christmas the time for giving just don't give to much attention to the end of world crap until you see it around you.  It will not be to late since no one else is looking...

Mon, 12/15/2014 - 10:46 | 5553399 Dame Ednas Possum
Dame Ednas Possum's picture

@Zoomorph:

Mate you'd struggle to finish The Very Hungry Caterpillar.

Get your crayons out, go sit in the corner and try to not harm yourself.

And don't worry, I won't tell your hasbara supervisor.

Mon, 12/15/2014 - 09:31 | 5553056 Motorhead
Motorhead's picture

Ever read the incessant hype from KingWorldNews and Jim (gold ain't going below $1600/oz.) Sinclair?  It's not stop, which means, they've been WRONG non-stop.

Mon, 12/15/2014 - 00:59 | 5552455 Syrin
Syrin's picture

Not your dog. Your gun. Didn't that fall out of the boat in tackle box with your gold on a fishing trip? That's what happened to me. Was tragic.

Mon, 12/15/2014 - 02:48 | 5552594 Oliver Jones
Oliver Jones's picture

Let me guess, Phoebe was a golden retriever? :)

Mon, 12/15/2014 - 05:50 | 5552735 Rubbish
Rubbish's picture

Some folks were boated.

Sun, 12/14/2014 - 23:34 | 5552252 Greenskeeper_Carl
Greenskeeper_Carl's picture

Ya I find the idea of them going door to door and saying 'we have hear your bank statement that says you purchased 2 10 gram bars with your credit card from apmex, hand them over, citizen'. They will go after the ETFs, large institutional holders, and order all domestic mines to 'sell' all their product to the govt or central bank long before they start kicking people's doors in because they have a few ounces. It will take a lot of leg work to collect a small amount of gold bullion, and they will start taking some casualties from people who decide their patriotic duty doesn't include turning over their life's savings to their bankrupt, irresponsible govt, which will probably make it hard to keep those people on the job

Mon, 12/15/2014 - 04:19 | 5552666 Titus
Titus's picture

Yeah, but there will be a threat for not reporting just like in the tax system, go to jail and do not pass go. Won't really be enforced for small guys, but examples will be made because, well, they're dicks.

Mon, 12/15/2014 - 12:38 | 5553998 Number 156
Number 156's picture

In order to confiscate it they need to know where it is located. I ain't tellin'.

How many people turned in gold in the 1933 confiscation scheme?

 

Just sayin.
You know your freindly government will stop at nothing to restock the basement under 33 Liberty.

Sun, 12/14/2014 - 22:36 | 5552051 SumTing Wong
SumTing Wong's picture

What gold coins and bullion? What silver coins and bullion? I don't know what you're talking about...all of mine were lost in a horrible boating accident.

Sun, 12/14/2014 - 22:56 | 5552128 MsCreant
MsCreant's picture

Someone out there, somewhere, really did lose their gold in a boating accident. I feel for you dude or dudette!

Sun, 12/14/2014 - 23:52 | 5552165 cowdiddly
cowdiddly's picture

Yea by the thousand tons with legalized Piracy and Letters of Marque from the Banks of England. No worries thou they were just trying to steal it from Spanish Galleons who had just stolen it themselves by chopping the indigenous peoples hands and feet off to make em tell where the shiney was.. Those doubloons and Spanish reales still to this day wash up on Florida beaches occasionally.

Boating Accidents are not just a modern phenomenon in regards to the precious. They more things change...................nor organized crime in gov;t or rigged courts or terrorizing brown people..

I really love those modern day sunken treasure salvage co finds where the European countries all start laying claims to these discoveries. Oh it was on a Spanish ship inroute, No, it was in English waters, its the Queen's gold. Hey the bill of laden was owed to us Dutch and then poor ole Brazil says that hey wait a minute, you stole it from us. Then crickets. Every stinkin time the International courts rule in favor of some European govt power that was stealing it from someone else in SA.

Mon, 12/15/2014 - 00:19 | 5552371 ReasonForLife
ReasonForLife's picture

Confiscation is not an accurate term to describe what happened in the 1930's, it was not a confiscation because they didn't straight up take the gold from you.  Instead, it was a nationalization, where they asked people to turn in their gold in EXCHANGE for paper receipts that had fiat value.  A confiscation would be that they simply took it from you and provided nothing in return.

Your best bet if you're afraid of confiscation is to accumulate gold and silver jewelry, which is highly unlikely to be confiscated or nationalized, as it's not money.  It is also more discreet to transport on your body.  Sure, they confiscated jewelry in concentration camps, but if you allow yourself to get that far into oblivion, gold is the least of your concerns. 

The cheapest way to purchase gold jewelry is to do cash for gold ads, and just buy from people looking to sell their old gold, I would pay them around 80% of the market value, most cash for gold folks scheme people and pay only 40%, when the refinery then pays the buyer 95-97% of the gold value.  Or, purchase investment grade jewelry from mike maloney's site, goldsilver com, but then you're paying a premium.

 

Mon, 12/15/2014 - 00:26 | 5552395 graveheart
graveheart's picture

Everyone of my gold and silver coins, PCGS and NGC slabbed and graded, are hanging from a necklace.

Mon, 12/15/2014 - 03:09 | 5552618 Nostradumbass
Nostradumbass's picture

Wearable wealth.

Also gold watches made from coins.

Thick, heavy bracelets with 1 gram removable links would be nice too.

Mon, 12/15/2014 - 08:12 | 5552863 DanDaley
DanDaley's picture

Or you could become a dentist -they were exempt in the '30s too.

Mon, 12/15/2014 - 02:58 | 5552605 OldPhart
OldPhart's picture

All of mine was stolen a year ago.

 

I just don't know about it, yet.

Sun, 12/14/2014 - 22:13 | 5551985 unrulian
unrulian's picture

Canada's or mine? Canada sold all hers and mine was confiscated by the water gods

Sun, 12/14/2014 - 22:24 | 5552008 Uber Vandal
Uber Vandal's picture

NOTHING is safe from confiscation when it really gets down to it.

 

 

Mon, 12/15/2014 - 00:22 | 5552379 ReasonForLife
ReasonForLife's picture

It's only confiscatable if they know you have it, and where.  Be lower than grass, and quieter than water.

Mon, 12/15/2014 - 03:21 | 5552628 Global Observer
Global Observer's picture

May help in holding on to your gold, but may not help if you intend to use it to trade for anything useful. If and when they make it illegal to possess gold, they will also announce rewards to snitches. Trade using gold as payment will become restricted to people with a high degree of trust between them.

Mon, 12/15/2014 - 08:39 | 5552915 VAD
VAD's picture

As long as they are not just ones and zeros on someone else's server.

Mon, 12/15/2014 - 00:19 | 5552127 opport.knocks
opport.knocks's picture

There is a fairly robust system of Credit Unions here in Canada, Their legislated capital requirements are higher than the banks and there are none of the obscene CEO pay and other abuses. I have not had a conventional bank account since I was a teenager. Bail in makes them look even better.

Mon, 12/15/2014 - 01:13 | 5552471 Rock On Roger
Rock On Roger's picture

I'm not so sure the CUs are safe either. If one Canadian bank goes down I' sure it will drag all the ather financial institutions with it. Credit Unions, Insurance Co. Investments Funds.

 

 Canada Action Plan 2013, Pg 145

Mon, 12/15/2014 - 01:44 | 5552524 PT
PT's picture

"We have to take your moneys so you will spend more.  There.  We fixed the Economy."

Mon, 12/15/2014 - 03:52 | 5552660 Global Observer
Global Observer's picture

Everyone, including Credit Unions, but excluding banks, not holding the savings/deposits in vault cash, holds them in a bank account. Banks hold their deposists with the Central Bank. If a Credit Union's deposits at a bank get bailed in, not sure they can honour their promises.

Sun, 12/14/2014 - 22:11 | 5551967 LetThemEatRand
LetThemEatRand's picture

"Savings" -- that's when you get a super discount by camping out in front of a store for a week, right?   This article makes me worried that I am going to get less savings.  I don't know who this "Bailins" guy is, but he better not take my savings.

Sun, 12/14/2014 - 22:12 | 5551987 tgmur10
tgmur10's picture

Best Laugh of the Day!!!  LOL!!

Sun, 12/14/2014 - 22:37 | 5552059 SumTing Wong
SumTing Wong's picture

I'm watching George BailIn right now...he is having A Wonderful Life.

Sun, 12/14/2014 - 22:43 | 5552073 Muppet
Muppet's picture

Actually, I am too.   Janet Yellen does resemble Mr Potter.     "the poor just need to buy more stocks"

Sun, 12/14/2014 - 22:44 | 5552085 GeezerGeek
GeezerGeek's picture

Is he Sarah BailIn's brother?

Sun, 12/14/2014 - 22:14 | 5551992 Stormtrooper
Stormtrooper's picture

"If bail-ins take place, which now seems almost certain when banks get into difficulty again, there is a very significant risk that bail-ins alone will lead to a collapse in consumer and business confidence as consumers and businesses see their savings and capital confiscated."

And many bankers and federal employees of all levels (especially of the Washington, D.C. based sort) taking 30-06 rounds center-of-mass during the "reset".

Sun, 12/14/2014 - 22:09 | 5551980 alexcojones
alexcojones's picture

Bail ins. 

Like pouring water into the Titanic.

Sun, 12/14/2014 - 23:12 | 5552181 Dre4dwolf
Dre4dwolf's picture

Well since the banks are loading up on emergency disaster relief supplies.

You can be assuered the rich are getting into the life-boats by now.... while the middle class is locked up behind cages on the lower decks.

 

Sun, 12/14/2014 - 22:15 | 5551988 SickDollar
SickDollar's picture

I honestly think  no one  will escape if the bail-ins happened

Sun, 12/14/2014 - 22:20 | 5552004 LetThemEatRand
LetThemEatRand's picture

There's this guy named Corzine who doesn't remember anything or know anything, but he's pretty sure he'll be okay.

Sun, 12/14/2014 - 23:03 | 5552149 RaceToTheBottom
RaceToTheBottom's picture

Nonsense, the only bankster who will not be OK is the one who turned himself in.

This is the opposite of 1985

 

Sun, 12/14/2014 - 22:49 | 5552075 MollyHacker
MollyHacker's picture

Nobody will escape bail-ins because the 'direvatives' risk exposure for insuring against default has a dollar hegnomy payout guarantee.

http://www.zerohedge.com/news/2014-12-12/presenting-303-trillion-derivat...

Sun, 12/14/2014 - 22:15 | 5551989 Dre4dwolf
Dre4dwolf's picture

If everyone pulls their money out, banks fail and a bail in happens, everyone would be better off (assuming u dont work for a bank), in that scenario your savings would actually go up in value, even if you had 1000$ in the bank and you only managed to pull out say 500, that 500 could endup being worth 2~5000 more than the 500 you lost.

Mon, 12/15/2014 - 03:38 | 5552643 noben
noben's picture

I was told that ZH was good for front-running some economic and political events.

I did my part by leaving only enough in the chequeing account to handle the monthly bills. The rest is in Cash and other time-proven assets that are under my direct control (PM, property, and quality wine that I let age at my home, not the 'Estate'). Quality wine is "Poor Man's Fine Art", but should be admired less frequently than art, for obvious reasons: "liquidating" the profits. But that too has its advantages, as my avatar suggests.

Even many consumer goods and staples are a good, as they tend to hold value as a hedge against price inflation, especially if you look for mega deals (i.e. you 'BTFD').

Mon, 12/15/2014 - 07:43 | 5552810 BrosephStiglitz
BrosephStiglitz's picture

How the hell do you figure that?

Let's do some quick mathematics on that:

Assume that we have a two period timeline: before bail-in, after bail in.

X1 = total reserves (cash) in bank before bail in.  

Assuming cash holdings (X2) to be negligible in this time period (a very small fraction of total money supply.)

Sum(X1+X2) = Total money supply (T) (in this furnished example.)

We have X+(0)X2 = (1)T

All of a sudden 3/4 of the X1 gets withdrawn.

Now 1/4X1 + 3/4X2 = T1

As banks need to keep reserves it is fair to assume that there will be some form of Govt. intervention.  This has been proven historically.  The government now creates electronic zeros and ones to "refill" the drained bank balances.

X1+3/4X2 = (7/4)T2

T2 - T1 = 3/4X <=== The money supply has increased.  Any money held outside the bank now has 1/(7/4) = 4/7 = 0.571 of its original face value when the market finds its original price.

Furthermore, if you assume that these ones and zeros are "tethered" to something (in actuality this would be productivity) then the taxpayer is on the hook for this cost.

So remind me how the hell the money becomes more valuable?

If you are talking about a scenario with no bail-in and a deflationary "collapse" of credit then it is possible that cash becomes worth more.  That's assuming the government doesn't default (see: unlikely in the case of most nations running high deficits), or a collapse in confidence doesn't go thermonuclear.

The only instance that holding money outside a bank is valuable is if you think that a bail-in will happen, and even then that cash should probably be designated in a "stable" foreign currency.

Since we know that central banks love to "intervene" on their currencies in order to not destroy their balance of trade, it is pretty safe to assume that unless you are holding Martian Dollars, you are probably going to get shit on in cash currency regardless.  If the dollar moves (for now), they all will move in unison as time goes by.

Mon, 12/15/2014 - 09:42 | 5553058 Dre4dwolf
Dre4dwolf's picture

The logic is simple.

 

M0 vs M1 vs M2 Vs M3 Vs M4

 

http://www.tradingeconomics.com/united-states/money-supply-m0

 

 Only $3,830,424,000,000 in notes and coins in circulation supporting 10,000s of billions of dollars.

 

Even if you hold one note. . .  and all the banks fail you will have MASSIVE deflation a house that once cost 1000000 could endup costing only 250,000$

 

Adjusting for deflation 1 USD post collapse could be worth say about 4~5$ post collapse.

 

Say you managed to pull out 500$ you are talking the purchasing power of almost 2,000$

 

There is that much counterfeit credit on deposits, and no one really has any physical currency . . . most of the population wont go pull money out, and this means the people that do will probably get atleast 20~50k out before collapse.... simply pulling your money out before everyone else will allow you to retire, buy a house and stop working for pretty much the remainder of the time the same currency is being used.

50k will buy what 200,000+ bought pre-collapse at the minimum.

 

For all intents and purposes the only real money is M0 and Gold/Silver everything else is fraudulent currency credit tied down by speculation and corruption , bank failures cause currency destruction, because money that doesn't actually exist tends to "vaporize", the reserves you mention tend to essentially be nothing but ledger entries, it doesn't exist anywhere but on some scribble in a ledger, and when banks fail you can't liquidate Excel Spread Sheets.

Sun, 12/14/2014 - 22:14 | 5551993 eatthebanksters
eatthebanksters's picture

If the TBTF banks end up needng baii-ins to survive then I suspect the country will see the first flames from those who have repeatedly been stomped on to save the TBTF banks.  I'll have my book of matches waiting.

Sun, 12/14/2014 - 22:32 | 5552036 sun tzu
sun tzu's picture

Don't do like those idiots in Ferguson and Oakland and burn down mom & pop grocery stores and restaurants. 

Sun, 12/14/2014 - 23:08 | 5552168 Realname
Realname's picture

Ill be more than happy to volunteer a barrel of gasoline for your cause. This is special gas...its got electrolytes; just what a banker needs.

Mon, 12/15/2014 - 00:30 | 5552404 Greenskeeper_Carl
Greenskeeper_Carl's picture

That reminds me of an old joke about Hillary I heard back when she was running in 08

"There was a traffic jam on the highway, and no one had any idea what was going on until a couple guys came walking down the line of cars. They stopped at each window and explained that a bunch of terrorists were holding Hillary Clinton hostage and were threatening to dose her in gasoline and light her on fire unless they were given a 5 million dollar ransom, and the guy was walking g down the highway taking donations. 'How much are most people giving?' I asked. 'On average, 1 to 2 gallons' the man replied...

Mon, 12/15/2014 - 03:07 | 5552613 OldPhart
OldPhart's picture

Fuck electolytes...Add detergent to the gasoline, something common, like liquid Tide.

Then you have napalm.

Pour that shit into molotov's and see the response.

Wed, 12/17/2014 - 23:14 | 5566613 PT
PT's picture

In case you missed the reference:

https://www.youtube.com/watch?v=e1fKzw05Q5A

But your idea is good too.

http://www.imdb.com/title/tt0387808/

It's a documentary!  It's the history of the future!

Sun, 12/14/2014 - 22:16 | 5551996 SillySalesmanQu...
SillySalesmanQuestion's picture

What savings are we referring to...? The savings on lower gas prices or the three hundred trillion in derivative losses we have been stuck with as a tax write off...

Sun, 12/14/2014 - 22:26 | 5552015 yogibear
yogibear's picture

Reason enough to pull all your money from the banks.

 

http://www.huffingtonpost.com/ellen-brown/bailout-is-out-bailin-is-_b_31...

Bank of America's commingling of its ominously risky derivatives arm with its depository arm over the objections of the FDIC; and the fact that most EU banks are now insolvent.  A crisis in a major nation such as Spain or Italy could lead to a chain of defaults beyond anyone's control, and beyond the ability of federal deposit insurance schemes to reimburse depositors.

Sun, 12/14/2014 - 22:29 | 5552023 FreeNewEnergy
FreeNewEnergy's picture

Does the 1921 silver dollar I found in my attic today count? Really, I was cleaning out the attic today and it just fell out of a box. Made my day. Now that's my version of a bail-in!

Sun, 12/14/2014 - 22:35 | 5552042 Cognitive Dissonance
Cognitive Dissonance's picture

Silver bells, silver bells, it's Christmas time in the attic.

Sun, 12/14/2014 - 22:36 | 5552046 sun tzu
sun tzu's picture

Make sure you give the IRS their fair share

Sun, 12/14/2014 - 22:39 | 5552064 SumTing Wong
SumTing Wong's picture

I've got something to give the IRS...

Mon, 12/15/2014 - 07:43 | 5552829 Winston Churchill
Winston Churchill's picture

Send it in a Thermos so its still steaming.

Sun, 12/14/2014 - 22:29 | 5552025 Number 156
Number 156's picture

Bail ins? I agree.

If not that, we can expect to see negative interest rates. The bail in though seems more credible because charging depositors is a sure way to start a bank run, whereas a bail-in can be preceded by a bank holiday. Good luck getting your money out.

Sun, 12/14/2014 - 22:28 | 5552026 Moe Howard
Moe Howard's picture

They will take it when and where they want, and you can't do shit. Prove me wrong.

Sun, 12/14/2014 - 22:37 | 5552050 sun tzu
sun tzu's picture

They can take it from your bank account. Let's see them go into houses and start taking things. There will be surplus jackboots on sale.

Sun, 12/14/2014 - 23:20 | 5552209 cornflakesdisease
cornflakesdisease's picture

I think they will go for the ETF holdings when it comes to gold, not so much people's stashes.  It is near immpossible to do that and they're would quickly ne a black market of precious metals.

Mon, 12/15/2014 - 00:03 | 5552346 Real Estate Geek
Real Estate Geek's picture

They'll also make you certify on your 1040 that you own no gold, because it's always nice to have amother felony hanging over the head of each serf so they stay in line.

Sun, 12/14/2014 - 23:26 | 5552230 the grateful un...
the grateful unemployed's picture

they come for your silver and gold, you give them lead

Sun, 12/14/2014 - 22:36 | 5552047 Hubbs
Hubbs's picture

OK, let's get specific: How safe is a  IRA US Treasury money market account in Vanguard compared to a checking account in Wells Fargo compared to physical gold in a private safe?

Sun, 12/14/2014 - 23:33 | 5552249 the grateful un...
the grateful unemployed's picture

worst IRA UST account treasury mm account, they can orphan that, even if they respect the $1 NAV they will be printing money so fast it will make your head spin. checking account in WF a bit better, but these guys are sending letters to large account holders telling them to get out!! dont try to park the family fortune in WF checking, physical gold in a safe, guy with a gun to your head, whats the combination? hmmm Obama just told all the cops to go home because theyre racist.

accounts in a foreign bank, i am sooorry senor we have no record of your account

a nice couple acres on the top of a hill, with a fence, a view, one of those 50cal rifles that can shoot one mile, and a few like minded friends, priceless

Mon, 12/15/2014 - 00:49 | 5552327 RaceToTheBottom
RaceToTheBottom's picture

Own the land via a company headquartered in NEV and pay rent to your firm for staying on the land.  

Maybe hold gold via hte same company??

Mon, 12/15/2014 - 07:47 | 5552833 Winston Churchill
Winston Churchill's picture

Make that Nevada company a subsiduary of a Belizean international business corp. and

then you're golden.

Sun, 12/14/2014 - 22:36 | 5552049 Fred Hayek
Fred Hayek's picture

"Own physical gold . . . in an allocated account"

or, translated:

"Do something so that you can achieve one result, but do it in a way such that you've completely wasted your f***ing time."

You own gold so that you aren't reliant upon somebody else's promise on paper! Letting a bullion bank hold it in an "allocated" account is carefully choosing the LEAST trustworthy entity on the planet and making yourself reliant upon their promise on paper.

Sun, 12/14/2014 - 23:18 | 5552200 cornflakesdisease
cornflakesdisease's picture

If you don't hold it in your hand . . . .

Mon, 12/15/2014 - 06:32 | 5552762 Tinky
Tinky's picture

Who said anything about a "bullion bank"? Are you aware that independent vaults exist?

Now, we can argue about the safetly of them, but they are obviously light years safer than any bank.

Mon, 12/15/2014 - 07:14 | 5552801 StandardDeviant
StandardDeviant's picture

They don't need to be in the same country you live in, either.  Singapore, for example, has all kinds of facilities for this, including some in the Free Trade Zones.  I'm sure HK or Zurich would work too.

"Safety" really depends on your threat model.

Are you worried about an old-fashioned armed robbery?  If so, a bank vault may still be better protected than an independent storage facility.

Bank holidays and bail-ins?  Then an independent vault would indeed be preferable to a bank, as you're more likely to be able to get to it than to a bank safety deposit box.  If things have gone that far, though, there's still a risk that they'll be caught up by the bail-in net.

Confiscation of physical gold by gov't?  For all the brave "molon labe" talk here, offshore storage is still better, as it's completely out of reach of their thugs.   But it does mean you can't get at it readily, as a substitute for a failing currency.

Best is probably a mixture: some in coins, some in a private vault nearby, and some offshore.

Sun, 12/14/2014 - 22:50 | 5552097 AdvancingTime
AdvancingTime's picture

A bad haircut, in this case means you have been robbed. That may be the case if the government reaches in over a long weekend and steals money from your bank account.

This is a horrible precedent to set, and the worst part may be how some people are letting it slip out that it would be fair, or in some way justifiable if it is only on the larger accounts. It is fine if it only impacts the savings of someone else, the savings of what they see as "the wealthy", the problem is someday they may come for you. I shudder to think what kind of world our children will live in. More in the article below.

http://brucewilds.blogspot.com/2013/03/a-bad-haircut-seizing-bank-accounts.html

Mon, 12/15/2014 - 06:54 | 5552779 StandardDeviant
StandardDeviant's picture

Well put.  It'd deserve a +1, if it weren't for the relentless blog-pimping.

Sun, 12/14/2014 - 22:59 | 5552133 philosophers bone
philosophers bone's picture

Most people have some "cash" in the bank and some "money market funds" in another account.  Good way to take it from both ends - Bailed in with the deposit and frozen money market funds until they get "marked to market".

Sun, 12/14/2014 - 22:59 | 5552134 anachronism
anachronism's picture

One pound of gold is worth about $20,000

Okay you got this pound of shiny yellow stuff. But it is absolutely useless to you!

Suppose that the government calls for a bail-in of 10% of the cash people have in the banks.  Very good! They are not going to get even an ounce of your gold. Now take your pound of gold to the supermarket, to the discount store, or the liquor store and try to shave off a few grams here and a few grams there to pay you bills. Can't happen!

Try to take it to the bank, and -after taking a 3-5% haircut from the bank for the privilege of handling your gold for you, the bank will then remit that same bail-in you were trying to avoid by owning physical gold.

Owning physical gold should be regarded the same way as owning a rare painting or sculpture, an antique crystal or piece of fine jewelry. It is worth only what someone else is willing to pay for it....in "fiat money"!!?? or whatever the owner will accept as barter in trade for it.

Far better that you should own shares in high-volume, internationally-traded, dividend-paying, "blue chip" stocks.

Sun, 12/14/2014 - 23:11 | 5552180 himaroid
himaroid's picture

Let them try, just once, a bail in, in the U.S.

Good thing that you will not want any of that gold and silver that will no longer for sale at any price.

Sun, 12/14/2014 - 23:14 | 5552186 joego1
joego1's picture

Don't take a pound a gold. Take a nice shinny ounce of silver. It might get you a bag of groceries.

Mon, 12/15/2014 - 01:39 | 5552511 WakeUpPeeeeeople
WakeUpPeeeeeople's picture

If it gets down to using a piece of silver to buy groceries or gas then a box of 9mm hollow-points will be worth about 10X its weight in gold

Mon, 12/15/2014 - 00:55 | 5552445 Rock On Roger
Rock On Roger's picture

Try buying a bag of groceries with a stock certificate.

 

Your argument is false.

Mon, 12/15/2014 - 01:47 | 5552513 anachronism
anachronism's picture

You don't take  a stock certificate anywhere.

You pay for your groceries with the cash dividends paid to you at regular intervals by the companies whose stocks you own.

As long as your shares are held on account at a major brokerage firm, you can  access your shares from any country where there is an international stock exchange. (About 30 countries maintain active exchanges for the shares of major corporations.) Your dividends can be paid to you in the local currency of any country which has such an exchange; and almost all of them will also pay them in US Dollars as well.

200 shares of Apple is worth about $22,000. They can be bought or sold in seconds. They pay about $360 per year in dividends. 200 shares of Chevron is worth about $20,000. They pay a dividend of about $800 per year.

Now wouldn't either one be a whole lot more useful and practical, and -I would argue- more valuable than gold? Apple is up about 1,500% in 6 years, while Chevron is up about 400% (even after the drop in oil prices this year) over the same period of time.

Mon, 12/15/2014 - 07:33 | 5552819 StandardDeviant
StandardDeviant's picture

Fair point about the dividend income, which you obviously forego if you hold gold or silver.

The current discussion, though, is about the danger of a bail-in.  How likely is it that a future bail-in is applied only to cash deposits in banks, and not to securities held in brokerage accounts?

That was the case in Cyprus; but it needn't be, next time around.  It's more difficult to seize securities, as such a move would have a catastrophic effect on prices.  However, consider the political hazards of a bail-in which confiscates only cash held by small (well, middle-class) savers and leaves untouched the paper assets of "the rich".  Whether directly or through some tax-system shenanigans, your shares are not guaranteed to escape the bail-in net either.

(As for Apple, etc. being up hundreds of percent...  That's true, but US stocks are currently expensive by almost any measure, while gold and silver are at multi-year lows.  It's very hard to time the markets well; not so hard to mis-time them...)

Sun, 12/14/2014 - 23:09 | 5552177 Ms No
Ms No's picture

The taxpayer on the hook for derivatives combined with the term bail in makes my hair stand on end.  Having the creeps didn't improve when I went to shoot skeet today and overheard the old guys chatting, no one can get any powder for reloading, everyone is out. 

I've done okay dollar cost average over the years but now i'm just spooked, think I may hit the dealer in the a.m.

Mon, 12/15/2014 - 07:34 | 5552820 StandardDeviant
StandardDeviant's picture

Coin dealer or powder dealer?

Mon, 12/15/2014 - 09:50 | 5553102 Ms No
Ms No's picture

Coin there isn't any powder.  I have become an example of people who jump in gold as it rises, oh well.

Sun, 12/14/2014 - 23:24 | 5552222 HYMN
HYMN's picture

Bail-in this, ratta-tat-tat-

Sun, 12/14/2014 - 23:25 | 5552224 the grateful un...
the grateful unemployed's picture

i listened to ellen brown on this at uaswatchdog, and she thinks only five banks will survive the next crisis, while making points about their derivative exposure (the cromnibus bill took care of that didn't it?) the only logical conclusion is to have your money in one of the five that will survive, and those of course are in the middle of the derivative storm. i can also make the case the fed will raise interest rates without accompanying inflation, which also means trouble for the small (S&L) type banks, where demand for loans, or in the case of the credit unions, no small business loans at all, have to match the rate, with no way to loan that money out. it looks like its go big or stay at home.

Sun, 12/14/2014 - 23:32 | 5552245 honestann
honestann's picture

Anyone with money in a bank or other financial account at this point in history really has to be considered out to lunch.  And yes, their funds will be stolen by bail-in and by other mechanisms as well.  Watch those vanishing pensions and retirement accounts, folks!

Sun, 12/14/2014 - 23:39 | 5552265 the grateful un...
the grateful unemployed's picture

i think theyll haircut the pension funds first, so you have some time, and while you can cash in your pension (right now CALPERS is making 8% a year, or was) nobody is going to do that. if you are in cash you have some options. remember when the pensions go the state goes, in CA the state has to make up the difference, so its a matter of state government solvency. if you are about half in cash and assets and half in your pension fund that would be a way to hedge. at the end of the day will you sleep at night, if you're all in cash you will probably have a heart attack, if everything you have in pension you just sit around and drink cheap beer with everybody else.

Mon, 12/15/2014 - 00:11 | 5552353 Chat_noir
Chat_noir's picture

the only way gold gets valuable is we come back to a gold standard (or price goes up in anticipation of that happening). period.

in all other scenarios, gold is worthless

Mon, 12/15/2014 - 00:13 | 5552356 Chat_noir
Chat_noir's picture

because as long as gold isnt money but an asset, it will be heavily taxed (as all other assets, financial or real estate for example), and there wont be any "remorse" to do it especially if the price shoots up. so gold would end up being confiscated, purely and simply, or via capital gain taxes, (when resold) or wealth taxes.

of course, its always possible to try to hide your assets and not pay taxes, but if youre talking about doing something illegal, why not rob your neighbour ?

or the simple other hedge is GET THE FUCK OUT OF YOUR COUNTRY, and go somewhere on earth unaffected by the forthcoming crisis. (Syria, ISIS ? for example ! ?? LOL)

Mon, 12/15/2014 - 00:26 | 5552388 Oscar Mayer
Oscar Mayer's picture

If people knew what populated their deposit accounts they'd realize what a farcical joke "Bail-Ins" are.  It's like paying your credit card bill with your credit card debt.  Nobody has any 'money' in their depost accounts, it's all bank debt, their promise to pay you, euphemistically referred to as 'Credit'.

Mon, 12/15/2014 - 00:44 | 5552426 LostAtSea
LostAtSea's picture

"of course, its always possible to try to hide your assets and not pay taxes, but if youre talking about doing something illegal, why not rob your neighbour ?" 

 

--- because I have a moral issue with robbing my neighbor.  Avoiding paying taxes based on an unconstitionall law.....not so much.

 

Mon, 12/15/2014 - 01:29 | 5552504 kchrisc
kchrisc's picture

"If you don't have it, you don't got it."

An American, not US subject.

Mon, 12/15/2014 - 01:53 | 5552534 russwinter
russwinter's picture

Parasite Guild Readying for Orchestrated Financial Attack on Europe

http://winteractionables.com/?p=17194

Mon, 12/15/2014 - 03:05 | 5552612 Goldy Locks
Goldy Locks's picture

Careful about "Safer Banks --> Switzerland Nbr 1" (first image). Swiss deposits may also be subject to bail-ins, though this is not explicitely mentionned on this post.

Look e.g. at http://www.finma.ch/e/finma/publikationen/Documents/pos-sanierung-abwick... :

Quote

This paper outlines how large banks with significant cross-border business can, in the event of a crisis, be resolved in such a way that the integrity of the group as a whole is preserved, avoiding a disorderly insolvency. Given the structure/nature of the largest Swiss banks, a bail-in at the parent bank is the most suitable strategy to achieve these goals. Following initial conceptual considerations, the aim here is to take the next step by outlining implementation options.

UnQuote

A domino is a domino is a domino. Remember the Swiss voted against the gold referendum. Things have changed.

Mon, 12/15/2014 - 03:23 | 5552631 Fuku Ben
Fuku Ben's picture

Product placement post sponsored by Goldcore

Who needs sex when fear sells so well

Mon, 12/15/2014 - 03:42 | 5552640 Yen Cross
Yen Cross's picture

Bail~In's      Haha

 

    Long Meat Hammers/

  macro numbers are a joke. We all know Central Babking is proping the Facade.

 I occasionally read the ETF clowns on Bloomturd.

 Idiots, unlearned

Mon, 12/15/2014 - 03:51 | 5552654 Yen Cross
Yen Cross's picture

 So I'm looking at these "model funds" looking to square up. These funds are just huge macro plays that hedge the bet on a ending price.

 Model Funds are a fuking joke! Bitchez

 I'm so long aud/usd. I'm even long the PONZI euro in Gartman terms.

Mon, 12/15/2014 - 05:10 | 5552701 SubjectivObject
SubjectivObject's picture

"More than seven years after the start of the financial crisis, banks have made strides towards improving financial stability but they are still struggling and pose risks."

HeeHawHuh?

Foot notes please?

Mon, 12/15/2014 - 06:27 | 5552760 smacker
smacker's picture

"...[bail-ins] put in place with very little public discussion or awareness of the risks and ramifications of bail-ins"

A serious understatement methinks.

As far as I know the subject has been completely by-passed by the political elites, virtually the complete MSM TV News channels (in the UK that's the BBC, Sky News, C4 etc) and printed Daily Slime. Even if it's occasionally mentioned by printed MSM, it's in a very casual manner and they never explain it. So the average person thinks it's a print error and should have read "bail-outs"; how wrong they are.

Mon, 12/15/2014 - 06:46 | 5552768 Ghordius
Ghordius's picture

smacker, I disagree. here on the continent, at least, "bail-ins" are understood as "banks can go bankrupt" and "cash deposit insurance only covers so much"

and in general, people here agree on both principles, as well as that cash on the banks is lending to them, and the least protected lending, to boot, with exception of the "insurance" part

my point is that in the eurozone banks are seen as ancillary to the real economy, and not "pillars of the economy" themselves. like facilities. cue in the Banker Bonus Cap

go back in time, and you'll see that all the current and possible future bail-ins in the eurozone have generated way more negative press in the English-speaking media

a cultural difference, I fear. One where British banking culture is "on the fence" between two extremes: the "new way" from America and the "old way" on continental europe

Mon, 12/15/2014 - 07:12 | 5552797 smacker
smacker's picture

Ghordius, I cannot say how "bail-ins" are viewed on mainland Europe. My comments were largely about the UK (and it's probably true in the US).

If you walked down any main street in the UK and asked random people what they know about "bail-ins", they would not know and probably think you were talking about "bail-outs".

THAT "bail-ins" will be funded from THEIR bank deposits to recapitalise insolvent TBTF banks would go right over their heads.

Some of the reasons for this whole subject being kept under wraps in the UK are:

- The British economy is heavily dependent on banking/finance.

- The Tories are in bed with bankers and The City, always have been.

- The coalition govt do not want to start bank runs. Bad for votes.

- MSM do not want to be accused of starting bank runs by running news stories about bail-ins and the risk they pose to peoples' savings.

- The BoE and Regulators have no brief to publicise such information, only to set up the procedures and rules about how they will operate.

- George Osborne/David Cameron are incompetent liars and cannot be trusted. Determined to keep the whole subject under wraps to prevent people thinking that the banks are still run by fraudsters, which of course they are. Or of people thinking that their much-spouted economic recovery is in fact a mirage, which it is, and that the banking reforms they claim have been introduced are another mirage, which they are.

Only if/when bail-ins are carried out will some people wake up to the raw criminality that is government.

Mon, 12/15/2014 - 06:34 | 5552763 22winmag
22winmag's picture

"banks have made strides towards improving financial stability"

Oh stop, you're killing me. That mega-turd Dodd-Frank bill has ensured that any "strides" are backward.

Mon, 12/15/2014 - 07:03 | 5552790 ArmyofOne
ArmyofOne's picture

Credit Unions.

 

Nuf Said.

Mon, 12/15/2014 - 12:54 | 5554084 shouldvekilledthem
shouldvekilledthem's picture

They operate with the same worthless fiat currency and pose the same 3rd party risks as banks.

Mon, 12/15/2014 - 12:53 | 5554078 shouldvekilledthem
shouldvekilledthem's picture

Bitcoin.

Mon, 12/15/2014 - 13:18 | 5554221 Stevious
Stevious's picture

Stocks--medium risk?

99% of all who own stock do not own them.  Terms from brokers allow the broker to play with your stock to use as collateral.  Unless you own stock registered in your name, you own zero stock, only a promise from the broker to pay you ....if money is availeble....  In a major economic meltdown most brokers will fail.  Thus your promise turns to "get in line for a bankruptcy payout."

Banks are no longer safe.  FDIC will quickly run out of funds.

Brokerage firms are no longer safe.  SPIC will quickly run out of funds.

Physical gold/silver/platinum/rhodium/palladium may be declared illegal to own (as gold was until the early '70's.\

Buckets of old copper pipe are good... no risk there.

A self-sufficient small farm...?

 

 

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