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The FDIC's Plan to Raid Bank Accounts During the Next Crisis
As we've noted previously, one of the biggest problems for the Central Banks is actual physical cash.
The financial system is predominantly comprised of digital money. Actual physical Dollars bills and coins only amount to $1.36 trillion. This is only a little over 10% of the $10 trillion sitting in bank accounts. And it’s a tiny fraction of the $20 trillion in stocks, $38 trillion in bonds and $58 trillion in credit instruments floating around the system.
Suffice to say, if a significant percentage of people ever actually moved their money into physical cash, it could very quickly become a systemic problem.
Indeed, this is precisely what caused the 2008 meltdown, when nearly 24% of the assets in Money Market funds were liquidated in the course of four weeks. The ensuing liquidity crush nearly imploded the system.
Because of this, Central Banks and the regulators have declared a War on Cash in an effort to stop people trying to get their money out of the system.
One policy they are considering is to put a carry tax on physical cash meaning that your Dollar bills would gradually depreciate once they were taken out of the bank. Another idea is to do away with actual physical cash completely.
Perhaps the most concerning is the fact that should a “systemically important” financial entity go bust, any deposits above $250,000 located therein could be converted to equity… at which point if the company’s shares, your wealth evaporates.
Indeed, the FDIC published a paper proposing precisely this back in December 2012. Below are some excerpts worth your attention:
This paper focuses on the application of “top-down” resolution strategies that involve a single resolution authority applying its powers to the top of a financial group, that is, at the parent company level. The paper discusses how such a top-down strategy could be implemented for a U.S. or a U.K. financial group in a cross-border context…
These strategies have been designed to enable large and complex cross- border firms to be resolved without threatening financial stability and without putting public funds at risk…
An efficient path for returning the sound operations of the G-SIFI to the private sector would be provided by exchanging or converting a sufficient amount of the unsecured debt from the original creditors of the failed company into equity. In the U.S., the new equity would become capital in one or more newly formed operating entities. …
…Insured depositors themselves would remain unaffected. Uninsured deposits would be treated in line with other similarly ranked liabilities in the resolution process, with the expectation that they might be written down.
http://www.fdic.gov/about/srac/2012/gsifi.pdf
In other words… any liability at the bank is in danger of being written-down should the bank fail. And guess what? Deposits are considered liabilities according to US Banking Law. In this legal framework, depositors are creditors.
So… if a large bank fails in the US, your deposits at this bank would either be “written-down” (read: disappear) or converted into equity or stock shares in the company. And once they are converted to equity you are a shareholder not a depositor… so you are no longer insured by the FDIC.
So if the bank then fails (meaning its shares fall)… so does your deposit.
Let’s run through this.
Let’s say ABC bank fails in the US. ABC bank is too big for the FDIC to make hold. So…
1) The FDIC takes over the bank.
2) The bank’s managers are forced out.
3) The bank’s debts and liabilities are converted into equity or the bank’s stock. And yes, your deposits are considered a “liability” for the bank.
4) Whatever happens to the bank’s stock, affects your wealth. If the bank’s stock falls at this point because everyone has figured out the bank is in major trouble… your wealth falls too.
This is precisely what has happened in Spain during the 2012 banking crisis over there. And it is perfectly legal in the US courtesy of a clause in the Dodd-Frank bill.
This is just the start of a much larger strategy of declaring War on Cash. The goal is to stop people from being able to move their money into physical cash and to keep their wealth in the financial system at all costs.
Indeed, we've uncovered a secret document outlining how the Fed plans to incinerate savings to force investors away from cash and into riskier assets.
We detail this paper and outline three investment strategies you can implement right now to protect your capital from the Fed's sinister plan in our Special Report Survive the Fed's War on Cash.
We are making 1,000 copies available for FREE the general public.
To pick up yours, swing by….
http://www.phoenixcapitalmarketing.com/cash.html
Best Regards
Phoenix Capital Research
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Gosh, I wonder why there is no moar money in my accounts except to pay bills.
So, they really do want a revolution.
"Uhh, mr pResident, we seemed to have underestimated the Redneck Will To Fight."
"How are my Homo Batallions doing? I have a lot of faith in the 69th Division, the Gay Blades!"
"Uhh, well, they are all dead. Some guy down south even placed their decapitated heads in gay positions."
"Dammit. I knew I should have written an EO ordering everyone to be Gay."
The banks can take a haircut on my investment in lead.
Well you had better get down to it boy, you are almost out of time.
According to Aaron Russo, getting rid of cash has been the plan all along of the central bankers. Instead currency will be digital and people will either be implanted with a chip or have a chip in a card (already happening) to withdraw funds. That way the govt. can take your assets whenever they think you owe them money and if they don't like you, they can cut off your digital currency so you can't earn a living, buy food, travel, etc. Effectively you will be a non-person. Trying to use anything other than their digital currency will earn you the label of "terrorist".
Aaron Russo interview.
https://www.youtube.com/watch?v=LSGZ4Hkdyg4
"It forced all people small and great, rich and poor, free and slave, to be given a stamped image on their right hands, or their forehead, so that no one could buy and sell except one who had the stamped image of the beast's name or the number that stood for its name.
Wisdom is needed here; one who understands can calculate the number of the beast, for it is a number that stands for a person. His number is six hundred and sixty-six."
Please allow me to introduce myself for I'm a man of wealth and taste,
Pleased to meet you, hope you guess my name. But what's puzzling you is the nature of my game.
Mick Jagger The Rolling Stones
I do not think it is puzzling at all.
Thus the need to spread investment in cash, bullion, property, banks etc. which I did last year.
I'm serioiusly thinking I need to add even more bullion.
And how to you handle the risk of confiscation of your bullions ? And how do you buy things if you can only pay by Visa/MC/etc card ?
Yeah, big secret document my ass. All direct taxes must be apportioned among the States. There will be no tax on "cash" in your pocket in the USA.
Inflation, the cruelist tax of all.
I took my billions out of the banks several years ago. I buried it under my modest 3 bedroom, 2 bath rancher. I drive an old pickup to throw them off.
Gee, I drive a Ford with a fully legal automatic weapon behind the seat.
I even have a grenade launcher and 8 rounds I got from a Patriot in the Army. It's stashed for now out in the woods.
****
Mr pResident, Jade Helm has failed.
What!?!?
Nobody returned to base.
If a hedge fund deceides to take 2 billion dollars out of a fund, they sure as hell don't get it in cash. It was digital dollars in the fund in the first place. Those same digital dollars are still digital dollars in the account it went to.
Thanks Mr. Ed and thanks III-news. Imagine that. Banks gave me accurate information.
I agree about not keeping too much in there. The FDIC's reserves are pretty low with all the bank failures that have occurred over the last number of years.
Thanks again!
Just checked Wiki. They said the Deposit Insurance Fund has $18 billion in it. Cash and securities total $19 billion and they have access to $500 billion at Treasury. Wiki also noted that the FDIC advertises that it's backed by the full faith and credit of the US government, but that no legilsation other than a "Sense of Congress" resolution has been passed regarding that.
FZIC. Federal Zion Insurance Corp.
"Assuring Zion Gets Even More of Your Wealth."
Liberty is a demand. Tyranny is submission..
The American people are armed with a mighty weapon that no victim populace in the history of the world has ever had. That weapon is based on the precarious and vulnerable way that Zion and the DC US have built their empire on our backs in the form of fiat-debt.
The most powerful weapon the American people have is Rejection.
The system of fraud and theft that has been built up upon the backs of the American people is dependent upon our backs. Withdraw our backs, and the whole scheme collapses. This is our greatest weapon.
Stop Paying--Put it into food, and precious metals, etc. They stole whatever "debt money" they loaned you in the first place (fractional reserve banking) and soon you won't be able to pay them anyways, so Stop Paying.
Stop Playing--Stop being a tool for them to use, mock, and call "stupid." Stop Playing.
Stop Obeying--If they are in violation of the Constitution then they are not legitimate anyways, so Stop Obeying their unlawful dictates.
The Four Rs
Rejection: Stop Paying, Stop Obeying, Stop Playing
Revolution: It is inevitable, so prepare, as they are.
Restoration: Restore the American people, country and Constitutional republic.
Retribution: The guilty must answer for their crimes against the American people and the Constitution.
Is that you glenn?
Could you please be more specific:
1) you give defined amounts for PHYSICAL CASH, and money parked in BANK ACCOUNTS (which is what?... savings, demand acots, ??), STOCKS, BONDS and CREDIT INSTRUMENTS.
2) then, you opine that "Suffice to say, if a significant percentage of people ever actually moved their money into physical cash, it could very quickly become a systemic problem."
Uh-huh... followed by
3) "Indeed, this is precisely what caused the 2008 meltdown, when nearly 24% of the assets in Money Market funds were liquidated"
Oh my gawd!!!!
But how much is 24% of "assets in Money Market funds"??????????
HOW MUCH? 100 MILLION? 100 BILLION? 30 GAZILION? It makes a difference to someone who'd likes to form a complete picture of how things are.
As I have said before, your subject matter is interesting, you may know what you're talking about... but until you tell me, I DON'T KNOW WHAT YOU'RE TALKING ABOUT?
You may be good at finance (or not!), but you are a terrible writer!! I am interested in knowing what you think, and I am still waiting...
Retarded Analysis
"Perhaps the most concerning is the fact that should a “systemically important” financial entity go bust, any deposits above $250,000 located therein could be converted to equity… at which point if the company’s shares, your wealth evaporates."
Duhhhh, FDIC already only covers up to $250,000.
Deposits above $250,000 are already going to take a haircut during bankruptcy.
Incidentally, there should be no FDIC at all. If a bank fails, the creditors and equity-holders of a bank should take the loss, not the taxpayers via FDIC. To consider the fact that FDIC only covers $250,000 as "raiding bank accounts" is perverse; the every existence of any FDIC at all means that the taxpayer is getting raided. But apparently Phoenix would have the taxpayer on the hook for more than $250,000 per depositor!
It doesn't make sense that the banks-FDIC would confiscate bank accounts for physical cash when all they have to do is "print" more. They should know by now any hint of confiscation will mean a REAL flight to safety outside their gluttonous, greedy, sticky paws. There are lower hanging fruits than pissing off a whole set of armed bastards.
Your $250,000 and other points are well taken. I appreciate Phoenix Capital's due diligence and warnings but I believe the head knockers should do a big expose on their individual strategies to avert pauper status. Otherwise, please go away, they've made their opinions known.
The FDIC exists only to underpin the fractional reserve banking scheme. Full reserve banks would rise or fall on their own merits without a penny from taxpayers.
What I've been told by many banks is that the FDIC "insurance" is $250,000 per depositor. So, a married couple would have $500,000 of "insurance". I'm further told by all these banks that if a depositor has a living trust, then the "insurance" would be $250,000 per named primary beneficiary in the trust. So, if a trust for a married couple had 4 primary beneficiaries, it sounds like the "insurance" would be $1.5 million.
Can anybody verify that? As I say, I've been told that by just about every bank I've come across.
You must also think the Easter Bunnty is real.
"Can anybody verify that?"
It doesn't matter whether it is true or not. In October 2014, the tax payers were not liable for JPM's derivative losses. Today, the tax payers are.
The government can change the rules at any time.
"Due to my new EO, #1,098,746,345, all your Stuff belongs to me."
---The Bath House.
I can verify that what they say and what they acctually do when the SHTF are very different.
It's a per account amount, doesn't have anything to do with the number of names on the account, if there's one account number it's one account. If you have a lot of savings deposits, in excess of $250k, you need to open other accounts so that none exceed the $250k level.
Does not matter how many accounts. It's "each depositor"
That means names per bank. anything over $250K and you will have to use another bank to be covered
The really funny thing about it all, this $250,000, $500,000 thing, is that it is completely and totally moot.
As the dollar collapses and the banks implode, trillions of dollars, domestic and foreign, are going to go in search of assets, anything, that can be gotten to retain some value.
As a result, $2500,000 will, for just a moment, be able to purchase just about one loaf of bread. That is until that price then doubles.
Liberty is a demand. Tyranny is submission..
Guillotines will go up in values, as will baskets and pikes.
Dude, forget the FDIC, when TSHTF, we are on our own.
Have you cleaned the rust off your blade today?
Keep it sharp.
You know, during the French Revolution, the Blade got dull and they had to drop it three or four times.
Just a suggestion.
Yep, as the poster above me says, it's $250k per depositor, per bank, per ownership category. In theory, Bill Gates could have his entire fortune FDIC insured if he spread it around enough banks/accounts.
For complete details, check out the FDIC website.
Gotta laugh when I see the phrase ..."In Theory" ...
All speculation here regarding FDIC rules and likely actions seem to miss the real issue: regardless of the amounts in any accounts and how you want to interpret current FDIC rules/guidelines, the deposits will be trapped and completely at the mercy of the FDIC (which will be given its marching orders from the big guys). If you think any amount will be secure during the next big crisis, you are kidding yourself. The "rules" will change as necessary to keep the current system going for as long as possible.
It's all "Theory"
When the shit hits the fan the bankster / corporate cartel will "change the laws without notice" to reaveal the "true us vs. them" that it has allways been.
This argument about FDIC "rules" is laughable.
That's right, but it goes further: you can get up to $250,000 per ownership category, per insured bank. So it's best to spread your money around.
EDIT: Of course, Mr. Ed got right to the nub of the matter with his plain horse sense.
It may be that none of that matters because from what I've read, the FDIC reserves are very, very small compared to the possible exposure.
Personally, I'd try have as little money sitting in any one bank as possible.
Yes Mr. Ed, FDIC reserves are a fraction of what they allegedly cover, they would have to go to Congress to get more tax dollars to cover any big problems.
I think it's odd, bank holding savings goes bust, our tax dollars (to the .gov) get used to pay 'insurance' on our savings...sounds like a circle jerk to me.
"It may be that none of that matters because from what I've read, the FDIC reserves are very, very small compared to the possible exposure."
As I've indicated below, only half joking, the FDIC is really the FZIC--Federal Zion Insurance Corp.
And as indicated in your quote, their so-called reserves are small. That is because the payments into the fund are really just a way for the pols, crats, and banksters involved to line their pockets. But then I digress.
So, when the banks, plundered of the people's deposits, collapse, the banksters will then have the DC US borrow of their counterfeit poison from them, the banksters, so as to prop up what they, the banksters plundered in the first place.
Got it?
Liberty is a demand. Tyranny is submission..
Save Mankind
Guillotine a Bankster
...in other words, they promise 250K but you may be lucky to get even a tenth of that if a lot banks go bust. If I remember correctly, a failure of Citibank alone would pretty much wipe out the FDIC's reserves.
FDIC would be backed by the FedGov in general, and therefore the printing press. IMO there's no need to worry about losing your insured deposits. Even in a total banking collapse, you'll get your money.
The question is whether that money will buy you anything...
;-)
I haven't seen the "when" or "how" issue addressed yet. 6 months, 6 years? $60 per month?
Would it, though? They've already thrown mortgage holders under the bus to save the shareholders of selected banks. Would they not do the same to depositors if the bill is too big? After all, if the FDIC and .gov refuse to honor their "commitments", to whom do you appeal?
"Would it though?"
Yes, because politicians like to get reelected.
Who lost their seat over the GM bailout? TARP? Fannie and Freddie?
The best move politically is to save the biggest campaign contributors first and then promise the plebes you're gonna fix it in your next term.
We all know that if a bank or any other enterprise fails the accountants and bankruptcy attorneys will move in and take anything that's left.