Just drove the Interstate 5 corridor from San Diego to Portland. My credit cards stopped working in Sacramento (triggered a "fraud profile) no worries...EVERYONE takes cash FRNs..... NO ONE takes gold or silver.
I was being facetious. You made my point - plastic and electrons have their own drawbacks. How many big banks or government agencies are there that still haven't been hacked?
I just misplaced or lost my Chase card and had to cancel it yesterday. Since I use cash most of the time, I use the card only on rare occasions. I could sense their frustration in having to bother with replacing a card that never generates any fees for them.
Use of plastic is highly overrated.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>Just drove the Interstate 5 corridor from San Diego to Portland. My credit cards stopped working in Sacramento (triggered a "fraud profile) no worries...EVERYONE takes cash . . . >>
These days even the cops take it. Be careful traveling with cash.
This "legal" confiscation of cash is but one of many efforts to eliminate the carrying and use of cash. It's a part of the program to condition us not need or carry cash. Fear is a powerful tool. Before you know it one no longer depends on cash.
<< <i>Use of plastic is highly overrated. >>
It is a nice convenience but should always remain an alternative.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i><< Theoretically a depositor does loan his money to the bank when he deposits it for what he has been led to believe is safe keeping. However, you loan it to them and they loan it back out at more than 10X its value.>>
I was aware of this but after reading the link you provided, maybe I should empty out my savings and just keep enough in checking for bills. Why maintain a savings account, it pays nothing. >>
cohodk, how can you be so ill-informed? Cash isn't dead yet, I'll give you that much - but the other two items, can you refer us to some documentation that what you say is accurate? The last reports on FDIC funding I read (about a year ago) indicated severe lack of funding, and likewise - you certainly must be aware of the recent changes in the law that allow bank deposits to be considered as bank property, and the depositor's claims to be subordinate to the other bank liabilities. Are you kidding me? You don't know about this?
Q: Are You Printing Money? Bernanke: Not Literally
A cashless society accomplishes three very important FED goals:
1. It prevents a run on the banks. If there is no cash to take back from the banks and hoard in the safety of one's own pocket (or mattress), a run on the banks can forever be prevented. The real fear during the 2008 financial crisis was a run on the banks. Because 90% of consumer account balances are either loaned out (fractional lending) or invested by the bank for profits (thanks to repeal of the Glass-Stegall Act that prevented such risk taking), a demand for massive cash withdrawals would be a financial Armageddon for cash weak banks. The fact that Washington, Wall St. and the Federal Reserve collectively created this nightmare was irrelevant to the problem at hand. Through a massive PR effort to convince legislators that the end was near and that a massive taxpayer cash infusion was needed, while at the same time convincing Americans the problem was contained, the crisis was temporarily contained.
2. It strengthens the power of a bail-in. Financial leaders clearly understand that the taxpayer will not tolerate another bail out for the banks. Their new tool of choice will be a bail-in where account deposits will be confiscated to save a failing bank. The elimination of cash eliminates the ability of account holders to "rescue" their deposits.
3. It allows the FED to control the velocity (spending) of money. By applying negative interest rates (NIRP) to bank accounts (charging you to hold your money) most Americans would spend it rather than see it confiscated. NIRP is really no different than an inflation rate that is greater than your savings rate - both slowly reduce your purchasing power. NIRP, however, is a more obvious confiscation to the account holder and will motivate him to spend it rather than lose it. The fact that consumers, if not the banks, learned from the crisis to be wiser with their borrowing and with their spending has created a dilemma for the money masters - if the money is not flowing through the economy tax receipts are lowered and corporate sales (profits) are lowered. With NIRP, interest rates can become a tool to control savings and to control spending. When determined to be advantageous for the "overall" economy savings can be stimulated with positive/higher interest rates earned on accounts. When it becomes necessary to "force" consumers to spend, NIRP can be used to convince consumers to spend. Unfortunately our current economic state is crying for a spending stimulus. Bottom line is the FED thinks they are better than you when a decision must be made on whether to buy something or not to buy it.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i> and likewise - you certainly must be aware of the recent changes in the law that allow bank deposits to be considered as bank property, and the depositor's claims to be subordinate to the other bank liabilities. Are you kidding me? You don't know about this? >>
Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact?
<< <i> and likewise - you certainly must be aware of the recent changes in the law that allow bank deposits to be considered as bank property, and the depositor's claims to be subordinate to the other bank liabilities. Are you kidding me? You don't know about this? >>
Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact? >>
In Cyprus, account holders went to the end of the collection line. Keep in mind bail-ins are a global effort by the IMF. While the EU nations are implementing this with law, I am not really sure of its status in the US.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
2. It strengthens the power of a bail-in. Financial leaders clearly understand that the taxpayer will not tolerate another bail out for the banks. Their new tool of choice will be a bail-in where account deposits will be confiscated to save a failing bank. The elimination of cash eliminates the ability of account holders to "rescue" their deposits. >>
Taxpayers would not tolerate another bail out for banks, so to placate them, they would just steal their deposits...because they could tolerate that?
2. It strengthens the power of a bail-in. Financial leaders clearly understand that the taxpayer will not tolerate another bail out for the banks. Their new tool of choice will be a bail-in where account deposits will be confiscated to save a failing bank. The elimination of cash eliminates the ability of account holders to "rescue" their deposits. >>
Taxpayers would not tolerate another bail out for banks, so to placate them, they would just steal their deposits...because they could tolerate that?
you don't seriously believe that do you? >>
I believe there would be a lot less affected account holders to complain than there would be taxpayers. Additionally, it would literally take an act of a reluctant Congress to once again use taxpayer funds.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Underfunded to save a major single TBTF bank failure. Also known as "fractional funding."
<< <i>Cash is not dead. >>
IMF and FED want it to die. Will they get their way? Don't they always?
<< <i>Deposits to your bank account are not loans to the bank. >>
Then why does the bank get to use 90% of it the way they see fit without consulting the account holder? And if is safe from bank harm, why is FDIC "insuring" it.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact?
I'm waiting for cohodk to provide documentation to refute it, but here are some links:
Simply stating that these articles are based on conspiracy theory doesn't cut it. The banks will always spin this a different way. Who's interpretation is correct?
Q: Are You Printing Money? Bernanke: Not Literally
2. It strengthens the power of a bail-in. Financial leaders clearly understand that the taxpayer will not tolerate another bail out for the banks. Their new tool of choice will be a bail-in where account deposits will be confiscated to save a failing bank. The elimination of cash eliminates the ability of account holders to "rescue" their deposits. >>
Taxpayers would not tolerate another bail out for banks, so to placate them, they would just steal their deposits...because they could tolerate that?
you don't seriously believe that do you? >>
It would placate ME if they stole Your deposits instead of mine. Of course if a lot of banks go down then everyone gets their deposits stolen. It only works if the misery is confined .
Heres how it would work I think. A few banks go under and there is a bail in. Those depositors get screwed. As the contagion spreads and more people are affected there would be a hue and a cry from angry voters . Then the politicians who got the most angry calls would decide to let the remaining banks fail outright .
Banks with the strongest balance sheet or banks most politically connected could be about equally safe.
Let any intense build up on the war on cash be your clue to the closeness of bail-ins. Cash is the antidote for bail-ins. Account holders can counter any threat of bail-in simply by removing their cash. Digits cannot be removed, only spent.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Do it now before you fall prey to the "structuring" of cash withdrawals. There's a lot of reasons not to like Dennis Hastert, but what they've done to him is pure BS.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact?
I'm waiting for cohodk to provide documentation to refute it, but here are some links:
Simply stating that these articles are based on conspiracy theory doesn't cut it. The banks will always spin this a different way. Who's interpretation is correct? >>
You could quote a 1000 links telling the same lie and it still wouldn't be true.
Just look at the source of your links. All propaganda regurgitators.
Believe what you want and continue to be dumbfounded when things happen differently from your thoughts.
<< <i> and likewise - you certainly must be aware of the recent changes in the law that allow bank deposits to be considered as bank property, and the depositor's claims to be subordinate to the other bank liabilities. Are you kidding me? You don't know about this? >>
Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact? >>
In Cyprus, account holders went to the end of the collection line. Keep in mind bail-ins are a global effort by the IMF. While the EU nations are implementing this with law, I am not really sure of its status in the US. >>
Cypriot banks were controlled by the Russians. I know your fondness of that country, but the USA isn't Russia. However, if the USA gets taken over by Russia then your fears might be realized. If you are not alone in that fear then I would fear those that share your fear.
Jmski thanks for the links, although, none of those stories made any factual claim that other creditors, notably bond holders, would be held above depositors.
I must say it's shocking(jk) that Jim Sinclair is still urging EVERYONE out of the system. I guess we should all tell our granny, our auntie and all of the orphans to go to PMs and the barter system, because it's the only safe way with money and is prudent in his mind......thing is, he's a freaking wack-a-doo. and his advice is toxic, as is the advice of most zealots .
Years of Zero Interest Rate Policy is a fact. It's says all that needs to be said about the fragility of the economy and the inability of the FED to fix it. At best it is on life support.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I think he means that they are funded enough to cover his accounts.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
While I haven't found the US equivalent, here is a quote Canada's 2013 Economic Action Plan by their Minister of Finance. Id consider this to be a reliable source, no?
Don't be too quick to say the bail in strategy cant happen here if our neighbors up north already have it in writing. Who knows, we might as well. Still trying to find it.
Taken from page 154-155
Establishing a Risk Management Framework for Domestic Systemically Important Banks
Canada’s large banks are a source of strength for the Canadian economy. Our large banks have become increasingly successful in international markets, creating jobs at home.
The Government also recognizes the need to manage the risks associated with systemically important banks—those banks whose distress or failure could cause a disruption to the financial system and, in turn, negative impacts on the economy. This requires strong prudential oversight and a robust set of options for resolving these institutions without the use of taxpayer funds, in the unlikely event that one becomes non-viable.
The Government intends to implement a comprehensive risk management framework for Canada’s systemically important banks. This framework will be consistent with reforms in other countries and key international standards, such as the Financial Stability Board’s Key Attributes of Effective Resolution Regimes for Financial Institutions, and will work alongside the existing Canadian regulatory capital regime.
The risk management framework will include the following elements:
Systemically important banks will face a higher capital requirement, as determined by the Superintendent of Financial Institutions.
The Government proposes to implement a "bail-in" regime for systemically important banks. This regime will be designed to ensure that, in the unlikely event that a systemically important bank depletes its capital, the bank can be recapitalized and returned to viability through the very rapid conversion of certain bank liabilities into regulatory capital. This will reduce risks for taxpayers. The Government will consult stakeholders on how best to implement a bail-in regime in Canada. Implementation timelines will allow for a smooth transition for affected institutions, investors and other market participants.
Systemically important banks will continue to be subject to existing risk management requirements, including enhanced supervision and recovery and resolution plans.
This risk management framework will limit the unfair advantage that could be gained by Canada’s systemically important banks through the mistaken belief by investors and other market participants that these institutions are "too big to fail"
<< <i>Years of Zero Interest Rate Policy is a fact. It's says all that needs to be said about the fragility of the economy and the inability of the FED to fix it. At best it is on life support. >>
That sounds like someone who gets their "information" from reading blogs rather than from actual experience in the business world. The concepts of "fixing" the economy and the term "life support" speak volumes, but what's actually being said is not what you think
<< <i>Years of Zero Interest Rate Policy is a fact. It's says all that needs to be said about the fragility of the economy and the inability of the FED to fix it. At best it is on life support. >>
That sounds like someone who gets their "information" from reading blogs rather than from actual experience in the business world. The concepts of "fixing" the economy and the term "life support" speak volumes, but what's actually being said is not what you think >>
Of course she must be lying, it's on the internet.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
They're definitely trying to get rid of cash; couple thoughts to go with other reasons given.
One, MANY government programs, including the new behometh health care is income/asset based. Flushing everyone into digitized money will tighten enrollment.
Another, a large scale false flag banking hack takedown would allow them to "fix" things by revaluing or changing the value. The less hard cash out there in the world, the easier it is to dictate the fix. I think they're building up for a cyber crash. Get everyone digital then crash it. More and more glitchy stuff happening at my ATM and online banking.
I know...I know it's just a coincidence, but on several occasions EBT cards crashed. In several states on November 17, 2012, October 12, 13, and 15, 2013 EBT cards demonstrated as if they were turned off. On October 14, 2013 an area's cards functioned with limitless spending. So...oops.
<< <i>Years of Zero Interest Rate Policy is a fact. It's says all that needs to be said about the fragility of the economy and the inability of the FED to fix it. At best it is on life support. >>
Near zero interest rate policy is a fact. Everything else you wrote is an erroneous opinion.
<< <i>Everything else you wrote is an erroneous opinion. >>
Only because it differs from yours. Erroneous is in the eye of the beholder. How does your view of a strong economy explain years of continued ZIRP?
<< <i>The FDIC has an unlimited line of credit with Congess. It has access to all the money it would ever need. >>
Just another promise in case things get real bad. Even our Department of Defense who is tasked with national security gets no such promise. Part of the banking industry's PR program to help those that don't know better sleep at night.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
A meteorite could destroy your house, or a giant storm could whisk it away. I read all about these risks on a blog website, and now I'm "informed", so can act all pedantic and condescending toward the "doubters"
<< <i>A meteorite could destroy your house, or a giant storm could whisk it away. I read all about these risks on a blog website, and now I'm "informed", so can act all pedantic and condescending toward the "doubters" >>
Sleep well, the FED is not steering the meteor.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
FDIC might have a "promise of unlimited funding" from Congress but Congress does have to authorize increases in the FDIC funding, and the last reports I heard were that it was very low in funds.
My understanding is that many home mortgages are still under water and if housing prices decline, the problem will get worse.
My understanding is that there is even more leverage deployed in the banking system than there was in 2008.
My understanding is that about 20% of the $1 Trillion+ in student loans are already delinquent and that most recent grads are having difficulty getting fulltime jobs and/or well-paying jobs, which makes it pretty hard to support yourself plus keep up on student load payments, much less being able to buy a house and make the payments.
Regarding a zero interest rate policy, just about everybody knows that you only raise rates if the economy is overheating, so that loans are harder to obtain. If this is an economy that's overheating, why is unemployment so high and why are we at all-time highs for government assistance spending programs?
If the economy is as lethargic as it appears, a rise in interest rates will send the economy down and hiring will go negative. Tax collections will drop precipitously and the politicians will start threatening to cut pension benefits and public services.
A rise in interest rates will send the debt spiral into overdrive, especially if the economy isn't booming and generating tons of new tax revenue. More debt load because of higher interest rates will put more drag into the economy as less money becomes available for current expenses.
Frankly, nobody wants to pay for all of the government's largesse, and nobody wants to pay for his neighbor's stuff either. It's a game of musical chairs that nobody gets to win, unless you find a way to get out of the path of the inherent destructiveness of the political machine. It's a good time to play "heads up".
Oh, and to be clear about this.....if you don't watch out for yourself and your family and your friends, nobody else will either.
Q: Are You Printing Money? Bernanke: Not Literally
Text and to be clear about this.....if you don't watch out for yourself and your family and your friends, nobody else will either
Agreed 100%. The rest not so much.
Unemployment isn't "so high".
Number of people on govt assistance is a function of demographics and politics, not economics or monetary policy.
There is no difference between 0% interest rate and 0.25%, or even 0.50%. However a raise in rates could help get a little inflation moving through the system.
ZIRP is a continued effort to provide cheap money to the big gamblers, witness the equity bubble. The fact that raising rates will push the economy further into the ground is telling of the true state of a fragile economy. Until consumer spending of real money, and not debt, improves the economy will not improve. Put all that newly created real money into the hands of consumers and half the problem will be resolved. Maybe a helicopter is not such a bad idea.
Number of people on govt assistance is indicative of a poor economy. Other than a terribly weak economy let the good times roll.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>ZIRP is a continued effort to provide cheap money to the big gamblers, witness the equity bubble. The fact that raising rates will push the economy further into the ground is telling of the true state of a fragile economy. Until consumer spending of real money, and not debt, improves the economy will not improve. Put all that newly created real money into the hands of consumers and half the problem will be resolved. Maybe a helicopter is not such a bad idea.
Number of people on govt assistance is indicative of a poor economy. Other than a terribly weak economy let the good times roll. >>
Equities are only 20% higher than 15 years ago. Not even close to a bubble. If the DOW was at 50k I would agree and meet my 7 fold in 7 years criteria.
ZIRP is not pushing the economy into the ground...if you don't think the economy is stronger than in 2008 then it's no wonder why your opinions are so dour.
Consumers are spending their "real money", ie US dollars , to make major purchasers for cash as witnessed in the strong real estate market in your backyard.
Number of people on govt assistance is a direct result of increased population and politics. Yup, that's so damn right I had to restate it.
More misinformation based on incorrect interpretation. Your money deposited in s savings account is not a loan or iou.
Continued presentation of misinformation will not make it become truth. It will however cloud rational and reasonable judgment thus making one vulnerable to "them".
<< <i>Equities are only 20% higher than 15 years ago. Not even close to a bubble. >>
Since 2/1/09: SP 500 up 288% (735 to 2122) DOW up 252% (7062 to 17835) NASDAQ up 374% (1377 to 5153) Gold up 129% (918.25 to 1186.69)
Let me guess where cohodk sees the bubble.
<< <i>Consumers are spending their "real money", ie US dollars , to make major purchasers for cash as witnessed in the strong real estate market in your backyard. >>
Last time we let strong real estate convince us we had a strong economy we all ended up looking like cohodks.
Record number of people receiving government assistance has nothing to do with a failed/weak economy? Janet, is that you?
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Well, if it hadn't been mentioned here before, I wouldn't have known it is $250,000 now either. Growing up, it was $10,000 so how many times has it been changed?
The point is that the G-20 and IMF are discussing (or have already implemented) a new regime that subjugates deposits to some of the banks' other liabilities. If I can find the references to these changes, I will post them. It happened within the past year.
Q: Are You Printing Money? Bernanke: Not Literally
FDIC is not underfunded to protect account holders from a derivatives meltdown.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
derryb, do we know for a fact that G-20 has adopted this, and do we know that the US has also officially adopted it?
bluelobster has brought to my consciousness a realization that there are so many "authorities" making so many new rules, laws and regulations that it's going to be tough to stay abreast of all the cross-currents. There are so many power grabs in play that nobody really knows who is going to come out as the ultimate winner.
The question of the hour still seems to be - is debt and government spending going to function as the bedrock for the world's financial system, or not? Thirty years ago, it wouldn't have occurred to me to ask that question. Today, I doubt whether it occurs to many people to ask that question either.
My concern is - why would I trust any of these guys in the first place? All they've done is pump up bank profits via QE to enrich themselves and stick the debt payments into the US Treasury for us peons to supposedly pay off which will never happen because it's way too late to pay it off, even if we tried.
I note that this is debt that we never contracted to take on - there were no referendums on the bailouts or QE - and furthermore the bankers & politicians have not *EVER* been held accountable for their gross mismanagement and corruption, respectively. So, you must also ask yourself - why would I trust any of them?
Q: Are You Printing Money? Bernanke: Not Literally
"The key fact of Dodd-Frank, Title II of the Act to establish an Orderly Liquidation Authority, which vests the FDIC with the authority to conduct a European-style bail-in. The preamble to the Dodd-Frank Act claims "to protect the American taxpayer by ending bailouts." This is done, through "bail-in", which is a critical feature of the internationally established regime of what is called cross-border bank resolution."
It's time to consider money in a bank no different than your gold in someone else's vault. Bank deposit receipts are becoming nothing more than a paper promise to give it back to you.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i> Bank deposit receipts are becoming nothing more than a paper promise to give it back to you.
When were they anything else? >>
When they carried much less counterparty risk.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Comments
I was being facetious. You made my point - plastic and electrons have their own drawbacks. How many big banks or government agencies are there that still haven't been hacked?
I just misplaced or lost my Chase card and had to cancel it yesterday. Since I use cash most of the time, I use the card only on rare occasions. I could sense their frustration in having to bother with replacing a card that never generates any fees for them.
Use of plastic is highly overrated.
I knew it would happen.
<< <i>Just drove the Interstate 5 corridor from San Diego to Portland. My credit cards stopped working in Sacramento (triggered a "fraud profile) no worries...EVERYONE takes cash . . . >>
These days even the cops take it. Be careful traveling with cash.
This "legal" confiscation of cash is but one of many efforts to eliminate the carrying and use of cash. It's a part of the program to condition us not need or carry cash. Fear is a powerful tool. Before you know it one no longer depends on cash.
<< <i>Use of plastic is highly overrated. >>
It is a nice convenience but should always remain an alternative.
banning cash is the logical follow up to bail-ins
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i><< Theoretically a depositor does loan his money to the bank when he deposits it for what he has been led to believe is safe keeping. However, you loan it to them and they loan it back out at more than 10X its value.>>
I was aware of this but after reading the link you provided, maybe I should empty out my savings and just keep enough in checking for bills. Why maintain a savings account, it pays nothing. >>
My YouTube Channel
Cash is not dead.
Deposits to your bank account are not loans to the bank.
Parades and rain....sorry.
Knowledge is the enemy of fear
I knew it would happen.
1. It prevents a run on the banks. If there is no cash to take back from the banks and hoard in the safety of one's own pocket (or mattress), a run on the banks can forever be prevented. The real fear during the 2008 financial crisis was a run on the banks. Because 90% of consumer account balances are either loaned out (fractional lending) or invested by the bank for profits (thanks to repeal of the Glass-Stegall Act that prevented such risk taking), a demand for massive cash withdrawals would be a financial Armageddon for cash weak banks. The fact that Washington, Wall St. and the Federal Reserve collectively created this nightmare was irrelevant to the problem at hand. Through a massive PR effort to convince legislators that the end was near and that a massive taxpayer cash infusion was needed, while at the same time convincing Americans the problem was contained, the crisis was temporarily contained.
2. It strengthens the power of a bail-in. Financial leaders clearly understand that the taxpayer will not tolerate another bail out for the banks. Their new tool of choice will be a bail-in where account deposits will be confiscated to save a failing bank. The elimination of cash eliminates the ability of account holders to "rescue" their deposits.
3. It allows the FED to control the velocity (spending) of money. By applying negative interest rates (NIRP) to bank accounts (charging you to hold your money) most Americans would spend it rather than see it confiscated. NIRP is really no different than an inflation rate that is greater than your savings rate - both slowly reduce your purchasing power. NIRP, however, is a more obvious confiscation to the account holder and will motivate him to spend it rather than lose it. The fact that consumers, if not the banks, learned from the crisis to be wiser with their borrowing and with their spending has created a dilemma for the money masters - if the money is not flowing through the economy tax receipts are lowered and corporate sales (profits) are lowered. With NIRP, interest rates can become a tool to control savings and to control spending. When determined to be advantageous for the "overall" economy savings can be stimulated with positive/higher interest rates earned on accounts. When it becomes necessary to "force" consumers to spend, NIRP can be used to convince consumers to spend. Unfortunately our current economic state is crying for a spending stimulus. Bottom line is the FED thinks they are better than you when a decision must be made on whether to buy something or not to buy it.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i> and likewise - you certainly must be aware of the recent changes in the law that allow bank deposits to be considered as bank property, and the depositor's claims to be subordinate to the other bank liabilities. Are you kidding me? You don't know about this? >>
Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact?
<< <i>
<< <i> and likewise - you certainly must be aware of the recent changes in the law that allow bank deposits to be considered as bank property, and the depositor's claims to be subordinate to the other bank liabilities. Are you kidding me? You don't know about this? >>
Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact? >>
In Cyprus, account holders went to the end of the collection line. Keep in mind bail-ins are a global effort by the IMF. While the EU nations are implementing this with law, I am not really sure of its status in the US.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>
2. It strengthens the power of a bail-in. Financial leaders clearly understand that the taxpayer will not tolerate another bail out for the banks. Their new tool of choice will be a bail-in where account deposits will be confiscated to save a failing bank. The elimination of cash eliminates the ability of account holders to "rescue" their deposits. >>
Taxpayers would not tolerate another bail out for banks, so to placate them, they would just steal their deposits...because they could tolerate that?
you don't seriously believe that do you?
<< <i>
<< <i>
2. It strengthens the power of a bail-in. Financial leaders clearly understand that the taxpayer will not tolerate another bail out for the banks. Their new tool of choice will be a bail-in where account deposits will be confiscated to save a failing bank. The elimination of cash eliminates the ability of account holders to "rescue" their deposits. >>
Taxpayers would not tolerate another bail out for banks, so to placate them, they would just steal their deposits...because they could tolerate that?
you don't seriously believe that do you? >>
I believe there would be a lot less affected account holders to complain than there would be taxpayers. Additionally, it would literally take an act of a reluctant Congress to once again use taxpayer funds.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>The FDIC is not underfunded. >>
Underfunded to save a major single TBTF bank failure. Also known as "fractional funding."
<< <i>Cash is not dead. >>
IMF and FED want it to die. Will they get their way? Don't they always?
<< <i>Deposits to your bank account are not loans to the bank. >>
Then why does the bank get to use 90% of it the way they see fit without consulting the account holder? And if is safe from bank harm, why is FDIC "insuring" it.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I'm waiting for cohodk to provide documentation to refute it, but here are some links:
zerohedge
Financial Times
examiner
huffpost
zerohedge
daily reckoning
silver doctors
Simply stating that these articles are based on conspiracy theory doesn't cut it. The banks will always spin this a different way. Who's interpretation is correct?
I knew it would happen.
<< <i>
<< <i>
2. It strengthens the power of a bail-in. Financial leaders clearly understand that the taxpayer will not tolerate another bail out for the banks. Their new tool of choice will be a bail-in where account deposits will be confiscated to save a failing bank. The elimination of cash eliminates the ability of account holders to "rescue" their deposits. >>
Taxpayers would not tolerate another bail out for banks, so to placate them, they would just steal their deposits...because they could tolerate that?
you don't seriously believe that do you? >>
It would placate ME if they stole Your deposits instead of mine. Of course if a lot of banks go down then everyone gets their deposits stolen. It only works if the misery is confined .
Heres how it would work I think. A few banks go under and there is a bail in. Those depositors get screwed. As the contagion spreads and more people are affected there would be a hue and a cry from angry voters . Then the politicians who got the most angry calls would decide to let the remaining banks fail outright .
Banks with the strongest balance sheet or banks most politically connected could be about equally safe.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I knew it would happen.
<< <i>Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact?
I'm waiting for cohodk to provide documentation to refute it, but here are some links:
zerohedge
Financial Times
examiner
huffpost
zerohedge
daily reckoning
silver doctors
Simply stating that these articles are based on conspiracy theory doesn't cut it. The banks will always spin this a different way. Who's interpretation is correct? >>
You could quote a 1000 links telling the same lie and it still wouldn't be true.
Just look at the source of your links. All propaganda regurgitators.
Believe what you want and continue to be dumbfounded when things happen differently from your thoughts.
Knowledge is the enemy of fear
<< <i>
<< <i>
<< <i> and likewise - you certainly must be aware of the recent changes in the law that allow bank deposits to be considered as bank property, and the depositor's claims to be subordinate to the other bank liabilities. Are you kidding me? You don't know about this? >>
Jmski, so if a bank defaults on their bonds or to another creditor, secured or unsecured, the banks would be allowed to payoff other creditors while insured depositors would be left to suffer losses? Where are you getting that as a fact? >>
In Cyprus, account holders went to the end of the collection line. Keep in mind bail-ins are a global effort by the IMF. While the EU nations are implementing this with law, I am not really sure of its status in the US. >>
Cypriot banks were controlled by the Russians. I know your fondness of that country, but the USA isn't Russia. However, if the USA gets taken over by Russia then your fears might be realized. If you are not alone in that fear then I would fear those that share your fear.
Knowledge is the enemy of fear
I must say it's shocking(jk) that Jim Sinclair is still urging EVERYONE out of the system. I guess we should all tell our granny, our auntie and all of the orphans to go to PMs and the barter system, because it's the only safe way with money and is prudent in his mind......thing is, he's a freaking wack-a-doo. and his advice is toxic, as is the advice of most zealots .
Gone baby gone, to far gone.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>The FDIC is not underfunded. >>
Im sorry but what?
BST Transactions (as the seller): Collectall, GRANDAM, epcjimi1, wondercoin, jmski52, wheathoarder, jay1187, jdsueu, grote15, airplanenut, bigole
<< <i>
<< <i>The FDIC is not underfunded. >>
Im sorry but what? >>
I think he means that they are funded enough to cover his accounts.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Don't be too quick to say the bail in strategy cant happen here if our neighbors up north already have it in writing. Who knows, we might as well. Still trying to find it.
Taken from page 154-155
Establishing a Risk Management Framework for Domestic
Systemically Important Banks
Canada’s large banks are a source of strength for the Canadian economy.
Our large banks have become increasingly successful in international
markets, creating jobs at home.
The Government also recognizes the need to manage the risks associated
with systemically important banks—those banks whose distress or failure
could cause a disruption to the financial system and, in turn, negative impacts
on the economy. This requires strong prudential oversight and a robust set of
options for resolving these institutions without the use of taxpayer funds, in
the unlikely event that one becomes non-viable.
The Government intends to implement a comprehensive risk management
framework for Canada’s systemically important banks. This framework will
be consistent with reforms in other countries and key international standards,
such as the Financial Stability Board’s Key Attributes of Effective Resolution
Regimes for Financial Institutions, and will work alongside the existing Canadian
regulatory capital regime.
The risk management framework will include the
following elements:
Systemically important banks will face a higher capital requirement,
as determined by the Superintendent of Financial Institutions.
The Government proposes to implement a "bail-in" regime for
systemically important banks. This regime will be designed to ensure that,
in the unlikely event that a systemically important bank depletes its
capital, the bank can be recapitalized and returned to viability through the
very rapid conversion of certain bank liabilities into regulatory capital.
This will reduce risks for taxpayers. The Government will consult
stakeholders on how best to implement a bail-in regime in Canada.
Implementation timelines will allow for a smooth transition for affected
institutions, investors and other market participants.
Systemically important banks will continue to be subject to existing risk
management requirements, including enhanced supervision and recovery
and resolution plans.
This risk management framework will limit the unfair advantage that could
be gained by Canada’s systemically important banks through the mistaken
belief by investors and other market participants that these institutions are
"too big to fail"
Edit: here is the link
Link
BST Transactions (as the seller): Collectall, GRANDAM, epcjimi1, wondercoin, jmski52, wheathoarder, jay1187, jdsueu, grote15, airplanenut, bigole
<< <i>Years of Zero Interest Rate Policy is a fact. It's says all that needs to be said about the fragility of the economy and the inability of the FED to fix it. At best it is on life support. >>
That sounds like someone who gets their "information" from reading blogs rather than from actual experience in the business world.
The concepts of "fixing" the economy and the term "life support" speak volumes, but what's actually being said is not what you think
Liberty: Parent of Science & Industry
<< <i>
<< <i>Years of Zero Interest Rate Policy is a fact. It's says all that needs to be said about the fragility of the economy and the inability of the FED to fix it. At best it is on life support. >>
That sounds like someone who gets their "information" from reading blogs rather than from actual experience in the business world.
The concepts of "fixing" the economy and the term "life support" speak volumes, but what's actually being said is not what you think
Let a former FED official (Advisor to Richard Fisher) bring you up to date on reality: " It is high time central bankers acknowledge their complicity in enabling Congress to fiddle while the country burns."
Of course she must be lying, it's on the internet.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
One, MANY government programs, including the new behometh health care is income/asset based. Flushing everyone into digitized money will tighten enrollment.
Another, a large scale false flag banking hack takedown would allow them to "fix" things by revaluing or changing the value. The less hard cash out there in the world, the easier it is to dictate the fix. I think they're building up for a cyber crash. Get everyone digital then crash it. More and more glitchy stuff happening at my ATM and online banking.
In several states on November 17, 2012, October 12, 13, and 15, 2013 EBT cards demonstrated as if they were turned off.
On October 14, 2013 an area's cards functioned with limitless spending.
So...oops.
<< <i>Years of Zero Interest Rate Policy is a fact. It's says all that needs to be said about the fragility of the economy and the inability of the FED to fix it. At best it is on life support. >>
Near zero interest rate policy is a fact. Everything else you wrote is an erroneous opinion.
Knowledge is the enemy of fear
<< <i>
<< <i>The FDIC is not underfunded. >>
Im sorry but what? >>
The FDIC has an unlimited line of credit with Congess. It has access to all the money it would ever need.
Look up the FDIC charter.
Knowledge is the enemy of fear
<< <i>Everything else you wrote is an erroneous opinion. >>
Only because it differs from yours. Erroneous is in the eye of the beholder.
How does your view of a strong economy explain years of continued ZIRP?
<< <i>The FDIC has an unlimited line of credit with Congess. It has access to all the money it would ever need. >>
Just another promise in case things get real bad. Even our Department of Defense who is tasked with national security gets no such promise. Part of the banking industry's PR program to help those that don't know better sleep at night.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Liberty: Parent of Science & Industry
<< <i>A meteorite could destroy your house, or a giant storm could whisk it away. I read all about these risks on a blog website, and now I'm "informed", so can act all pedantic and condescending toward the "doubters"
Sleep well, the FED is not steering the meteor.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
My understanding is that many home mortgages are still under water and if housing prices decline, the problem will get worse.
My understanding is that there is even more leverage deployed in the banking system than there was in 2008.
My understanding is that about 20% of the $1 Trillion+ in student loans are already delinquent and that most recent grads are having difficulty getting fulltime jobs and/or well-paying jobs, which makes it pretty hard to support yourself plus keep up on student load payments, much less being able to buy a house and make the payments.
Regarding a zero interest rate policy, just about everybody knows that you only raise rates if the economy is overheating, so that loans are harder to obtain. If this is an economy that's overheating, why is unemployment so high and why are we at all-time highs for government assistance spending programs?
If the economy is as lethargic as it appears, a rise in interest rates will send the economy down and hiring will go negative. Tax collections will drop precipitously and the politicians will start threatening to cut pension benefits and public services.
A rise in interest rates will send the debt spiral into overdrive, especially if the economy isn't booming and generating tons of new tax revenue. More debt load because of higher interest rates will put more drag into the economy as less money becomes available for current expenses.
Frankly, nobody wants to pay for all of the government's largesse, and nobody wants to pay for his neighbor's stuff either. It's a game of musical chairs that nobody gets to win, unless you find a way to get out of the path of the inherent destructiveness of the political machine. It's a good time to play "heads up".
Oh, and to be clear about this.....if you don't watch out for yourself and your family and your friends, nobody else will either.
I knew it would happen.
Agreed 100%. The rest not so much.
Unemployment isn't "so high".
Number of people on govt assistance is a function of demographics and politics, not economics or monetary policy.
There is no difference between 0% interest rate and 0.25%, or even 0.50%. However a raise in rates could help get a little inflation moving through the system.
Knowledge is the enemy of fear
Europe.
I'm sure you are smart enough to find some blog that explains. Lol
Knowledge is the enemy of fear
Number of people on govt assistance is indicative of a poor economy. Other than a terribly weak economy let the good times roll.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
<< <i>ZIRP is a continued effort to provide cheap money to the big gamblers, witness the equity bubble. The fact that raising rates will push the economy further into the ground is telling of the true state of a fragile economy. Until consumer spending of real money, and not debt, improves the economy will not improve. Put all that newly created real money into the hands of consumers and half the problem will be resolved. Maybe a helicopter is not such a bad idea.
Number of people on govt assistance is indicative of a poor economy. Other than a terribly weak economy let the good times roll.
Equities are only 20% higher than 15 years ago. Not even close to a bubble. If the DOW was at 50k I would agree and meet my 7 fold in 7 years criteria.
ZIRP is not pushing the economy into the ground...if you don't think the economy is stronger than in 2008 then it's no wonder why your opinions are so dour.
Consumers are spending their "real money", ie US dollars
Number of people on govt assistance is a direct result of increased population and politics. Yup, that's so damn right I had to restate it.
Knowledge is the enemy of fear
<< <i>Dodd-Frank Act sets the stage for US bank bail-ins >>
More misinformation based on incorrect interpretation. Your money deposited in s savings account is not a loan or iou.
Continued presentation of misinformation will not make it become truth. It will however cloud rational and reasonable judgment thus making one vulnerable to "them".
Knowledge is the enemy of fear
I knew it would happen.
<< <i>Equities are only 20% higher than 15 years ago. Not even close to a bubble. >>
Since 2/1/09:
SP 500 up 288% (735 to 2122)
DOW up 252% (7062 to 17835)
NASDAQ up 374% (1377 to 5153)
Gold up 129% (918.25 to 1186.69)
Let me guess where cohodk sees the bubble.
<< <i>Consumers are spending their "real money", ie US dollars , to make major purchasers for cash as witnessed in the strong real estate market in your backyard. >>
Last time we let strong real estate convince us we had a strong economy we all ended up looking like cohodks.
Record number of people receiving government assistance has nothing to do with a failed/weak economy? Janet, is that you?
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I knew it would happen.
<< <i>He knows how they work. He also knows what proposals are being made by IMF. >>
C'mon now...he specifically says in that blog you linked that the insured amount is $100,000
The point is that the G-20 and IMF are discussing (or have already implemented) a new regime that subjugates deposits to some of the banks' other liabilities. If I can find the references to these changes, I will post them. It happened within the past year.
I knew it would happen.
Analysis of the bail in situtation
FDIC is not underfunded to protect account holders from a derivatives meltdown.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
bluelobster has brought to my consciousness a realization that there are so many "authorities" making so many new rules, laws and regulations that it's going to be tough to stay abreast of all the cross-currents. There are so many power grabs in play that nobody really knows who is going to come out as the ultimate winner.
The question of the hour still seems to be - is debt and government spending going to function as the bedrock for the world's financial system, or not? Thirty years ago, it wouldn't have occurred to me to ask that question. Today, I doubt whether it occurs to many people to ask that question either.
My concern is - why would I trust any of these guys in the first place? All they've done is pump up bank profits via QE to enrich themselves and stick the debt payments into the US Treasury for us peons to supposedly pay off which will never happen because it's way too late to pay it off, even if we tried.
I note that this is debt that we never contracted to take on - there were no referendums on the bailouts or QE - and furthermore the bankers & politicians have not *EVER* been held accountable for their gross mismanagement and corruption, respectively. So, you must also ask yourself - why would I trust any of them?
I knew it would happen.
"The key fact of Dodd-Frank, Title II of the Act to establish an Orderly Liquidation Authority, which vests the FDIC with the authority to conduct a European-style bail-in. The preamble to the Dodd-Frank Act claims "to protect the American taxpayer by ending bailouts." This is done, through "bail-in", which is a critical feature of the internationally established regime of what is called cross-border bank resolution."
EU regulators tell 11 countries to adopt bank bail-in rules
It's time to consider money in a bank no different than your gold in someone else's vault. Bank deposit receipts are becoming nothing more than a paper promise to give it back to you.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
When were they anything else?
Liberty: Parent of Science & Industry
<< <i> Bank deposit receipts are becoming nothing more than a paper promise to give it back to you.
When were they anything else? >>
When they carried much less counterparty risk.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Liberty: Parent of Science & Industry