Banks are crashing do you think our money in PAYPAL is safe?
YaHa
Posts: 4,220 ✭
Just a tidbit of imagination I had run across my brow. I have some money, yea good money I keep in paypal for my coin buying and Offshore acct, for sportsbetting during football season. SO what do you think?
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Although I am not happy with the 2% interest and have moved my funds to other places.
roadrunner
<< <i>This same question came up many months ago when it was discovered that ebay was putting it's Paypal funds in risky structured type vehicles to earn higher interest (you know the drill, funds called SIV's or other odd names). In fact, the fund was very risky, with high yields but low liquidity...just the opposite of what a Paypal depositor would be expecting. I don't know if they have since moved them out to a safer and more liquid vehicle. If they are still doing that you should not be keeping any funds there.
roadrunner >>
I think at one time you had the option to opt out of the automatic investment sweep to avoid risk. Of course then there is 0% interest as well.
Just a thought.
IF PP Money-Market accounts are heavily invested in risky paper, the funds are NOT "safe." PayPal
will provide a general-category list of the paper they park depositors' money in, upon request.
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with the Feds.
Go ahead, I'm waiting.
bob
Dave
<< <i>This same question came up many months ago when it was discovered that ebay was putting it's Paypal funds in risky structured type vehicles to earn higher interest (you know the drill, funds called SIV's or other odd names). In fact, the fund was very risky, with high yields but low liquidity...just the opposite of what a Paypal depositor would be expecting. I don't know if they have since moved them out to a safer and more liquid vehicle. If they are still doing that you should not be keeping any funds there.
roadrunner >>
Wow... I never knew that. Might as well take them to the horse track. Do you know of a link or an article on this, I would be very much interested?
<< <i>I cannot think of a single reason to have any more than $500 in your paypal account at any one time. If something WERE to happen, it wouldnt be devastating as say 20k. I basically just keep some "play money" in my paypal account just in case I need to pull the trigger quickly on something. >>
Why would you need to keep money in your PP acount to be able to "pull the trigger quickly?" I've never had a payment via checking account or credit card go any slower through paypal than if I had money in the acct.
I immediately transfer any funds out of my PP account to my checking whenever I get anything.
<< <i>I always keep my Paypal at $0. >>
I always try to keep my balance at $0 too.
<< <i>This same question came up many months ago when it was discovered that ebay was putting it's Paypal funds in risky structured type vehicles to earn higher interest (you know the drill, funds called SIV's or other odd names). In fact, the fund was very risky, with high yields but low liquidity...just the opposite of what a Paypal depositor would be expecting. I don't know if they have since moved them out to a safer and more liquid vehicle. If they are still doing that you should not be keeping any funds there.
roadrunner >>
I wish I could find out that info R/R. Although they are a private company they can go belly up also any minute then it's little guys like us with less than $10k in funds that will lose or fight to get something back.
Banks are crashing? First I've heard of that. Name 3 institutions that have failed and have left their depositors dealing
with the Feds. Go ahead, I'm waiting.
You must have been sleeping when IndyMac was in the headlines.
Yes, banks are crashing and getting ready to crash. Without FED intervention we'd have dozens of major banks already gone. IMac wasn't even on the top 300 list! A few words from Senator Chuckie got that ball to roll off the cliff. While I can't name 3 today, there are probably 100 in current talks with the regulators. Before it's all over, you'll have a 1000 banks on your list. Some banks have operated like hedge funds as of late. And I can name more than 3 hedge funds that went kaputski since they were the early leaders of the charge. BSC may not have been a bank but don't tell them as they operated as if they were one.
roadrunner
<< <i>I always keep my Paypal at $0. >>
I agree. However, my PayPal is usually at $0 because of their and eBay fees!!
My Registry Sets
smart thinking!
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
PayPal's MM acct is not Federaly Insured. CNN earlier article
Even if it paid 10% interest, I wouldn't have one red dime at PayPal.
Compare to the pre-FDIC period. In the years from 1920 through 1929 preceding the depression, a period of general prosperity for most people, 5,897 banks failed – more than 580 per year on average. Most business and individual depositors lost every cent.
<< <i>If interest is interesting, get an account at INGDirect. Works great and I think the minimum is $1. >>
On top of that...their savings account pays 3% ... short term C.D.'s...3.3% .... safest place with a decent return to place your $. all account are Federally Insured.
I can't stand ING. Their questions, passwords and extra security measures drove me totally crazy. They were unable to do a simple transfer of ownership that every other financial institution I work with did instantly. I need a local bank with ATM and tellers so I can write and deposit checks and talk, in person, to someone that can explain and/or fix things. ING just won't do for me but might be fine for individuals who only want a simple CD.
<< <i> I need a local bank with ATM and tellers so I can write and deposit checks and talk, in person, to someone that can explain and/or fix things. ING just won't do for me but might be fine for individuals who only want a simple CD. >>
ING is not set up to take the place of your "full service bank" along with all the incidental fees that are associated with them, but a place to park some $$$ for an above average return. I have not been inside a bank in 5 years & all my transactions are handled on line with my local Credit Union. Who needs dum_ a_ _ tellers to answer questions that are available either on line or via telephone. Just my thoughts.
$$ is moved then seems to wind up as Au bullion or junk silver, lately
Dave
<< <i>Oh man, the paranoia is so thick I could cut it with a knife....
Dave >>
-agreed, this is nutso...see previous post on page 2 for perspective...
Sell our coins and the children, but keep the women.
Absolutely, they have notable limitations. But compared to Paypal? No contest.
<< <i>
<< <i>This same question came up many months ago when it was discovered that ebay was putting it's Paypal funds in risky structured type vehicles to earn higher interest (you know the drill, funds called SIV's or other odd names). In fact, the fund was very risky, with high yields but low liquidity...just the opposite of what a Paypal depositor would be expecting. I don't know if they have since moved them out to a safer and more liquid vehicle. If they are still doing that you should not be keeping any funds there.
roadrunner >>
I wish I could find out that info R/R. Although they are a private company they can go belly up also any minute then it's little guys like us with less than $10k in funds that will lose or fight to get something back. >>
Actually, they are a public company (Ebay). I guess it's not surprising that they take the funds they have on deposit from customers and reinvest them it something yielding a better rate. Banks do the same thing. I don't think it matters what Ebay invest the fund into, as long as the company stays solvent. If Ebay was to go bankrupt though, I would think there might be a problem recovering funds held in a PP account. And no, there's no FDIC insurance, but there isn't with many money market funds either.
That's what I was thinking of. Vanguard, Fidelity, etc.
<< <i>There have been 5 bank failures in the US within the last year. All except IndyMac were small. Three of those were due to fraud. Not one depositor who stayed within the $100,000 FDIC limit lost anything, and even those beyond the limit are likely to get most or all their money. (That is the historical record, and there’s no indication of any change.)
Compare to the pre-FDIC period. In the years from 1920 through 1929 preceding the depression, a period of general prosperity for most people, 5,897 banks failed – more than 580 per year on average. Most business and individual depositors lost every cent. >>
Actually the FDIC is a joke. Indymac users who had more than 100K are looking at getting back roughly 50% of the money above 100K. This has been documented now through multiple news sources and I know one person who is lucky he had only 120K total in his accounts with Mac and he has been told he is getting 110Kish back from the FDIC.
The FDIC only has about $54 Billion to back bank failures so if we start to see more large banks go under this will be gone in an instant. The numbers I have seen for what the FDIC is going to spend out of this amount range from $4 to $8 Billion ish so far on IndyMac's failure. I have heard some larger numbers but I haven't seen it documented anywhere.
If you have a lot of money in the bank you might want to move some of that into something more secure like physical gold for the time being. If we see another large bank go under say WaMu, the rest of that $54 Billion will be gone.
Now the FEDS will probably just print a few hundred billion extra to cover these banks at first for the banks but then we get to look at some hyperinflation and maybe we can too pay $150 Billion for a loaf of bread like they currently are in Zimbabwe.
Worst Case Scenario