Sprott says fear of bank deposits is the new PM catalyst
derryb
Posts: 36,793 ✭✭✭✭✭
"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
0
Comments
Thanks for the reminder!
I knew it would happen.
<< <i>And I agree with him.
Eric Sprott >>
And I was all prepared to be happy with $360.00 Silver, Now I've got to hang on till $1,200.00.
Maybe I'll just bail out at the 16/1 point and let every one sweat out the 10/1 point.
I knew it would happen.
Box of 20
<< <i>So if silver were at $1200 would this destroy any premiums on coins. Say a bust half is worth about $1200 today at $40 silver. With silver at $1200 what would that bust be worth? Would the premium be destroyed. >>
I'll have Steven Hawkins whip us up a formula.
"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>IF silver reaches $1200 we will have a lot more to worry about than premiums on coins. >>
yep, alot more.
Too many positive BST transactions with too many members to list.
<< <i>If silver makes it to $1,200 - I would be able to buy a couple of my very own Chicago politicians. >>
Why think cold when at $1200 we could buy Boca Raton
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>I wish he had gone more in depth with his discussion of bank deposits and why people fear them. Any other writers out there in PM land have more learned discussion on the topic? >>
Informed depositors fear the future of their money sitting in the banks. The banks have legally loaned out deposits at a rate $33 to every $1 deposited (leverage), are surviving on bailout money while they payout incredible management bonuses, and have been allowed to present a completely false picture of their soundness with federally authorized radical changes in acceptable accounting standards. If and when one major bank starts to crumble (I believe it will be BoA) there will be a mad dash to all of them to get deposits out. It is believed that if depositors showed up all at once for only 5% of their money, the banks would have to lock their doors (bank holiday). Once a bank locks its doors, the rest will have to follow suit and probably remain locked for a while.
FDIC insurance is nothing more than a Public Relations commercial to make you feel your money is safe. FDIC is not physically able to cover more than 5% of all deposits. The whole banking charade is based on the expectation that not a whole lot of people will want to withdraw their money at any given time. One very bad day by one major bank will change that in an instant. A run on the banks will ruin them all within a few hours. A very limited amount of people would actually get their money.
When you deposit money into your bank account you have actually agreed to lend it to them. Federal Banking laws allow them to loan it right back out at many, many times its value. Based on recent bank performance in the area of loans and irresponsible spending (bonuses) do you begin to see the potential problem? Sprott is saying PMs are a logical, safe alternative and that more and more people are realizing it and this will result in higher demand and higher prices. Of course, the members here already knew this.
"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
Thanks for the the very brief and concise summary of why I hold, cherish, and idolize (entirely worship and hold dear) my PM's!
Ok, some hyperbole is acceptable and expected and absolute..........
Miles
Remember, most in power are convinced that massive failure of technically already failed banks will mean the end. It will be the end for them but I believe it will be the begining for the rest of us. I see smaller, local credit unions filling much of the void they leave.
They also believe that success of the economy is measured by the Dow and the S&P500 so all effort continues to be made to keep the markets propped up. When that effort is no longer successful PMs will eventually see their true value. Whether they will attempt to drive them underground at some point remains to be seen.
"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
Very true. If you want a reminder, or a glimpse into the psyche of these bankers when they are under pressure, just bring up a You-Tube video of Hank Paulson asking Congress for $800 Billion in bailout money with a 1-page document, right when Lehman failed.
He really reminded me of Daddy Warbucks in the Little Orphan Annie comic strip, and the similarities don't end with just his appearance.
The Lehman crisis brought international overnight Libor funds up over 4%, which basically says that the bankers weren't willing to trust each other, period. They had to have OUR money to grease their own skids before they could trust each other for a line of credit once again.
I still can't wrap my head around how WE the People got in the middle of THEIR problem. I keep wondering how ingrained this tendency to let bankers control the rulemakers is going to be.
I knew it would happen.
and if they are TBTF, they are TBT be Trusted.
Got CASH?
<< <i>And for act two , after the bank holiday, it would seem that would be an excellent opportunity to realign the currency. Maybe it is a good time for a revaluation or a chance to issue new money...you know, emergency powers and all that. It is interesting but when you search the net for "usd currency revaluation" or "usd reissue" you don't get much so it is not only not on the radar, it's not even on the net. This is a topic that is interesting because there are a number of large nations that are both vocal and anxious to get the USD out of the game and we can be sure they aren't just sittin' and wishin', they are workin' on it; so radar or not, it's out there...hummmm, maybe if I could read Chinese I could get some hits on my search.
Got CASH? >>
China will have a MASSIVE civil war if the USA and Europe fail. Where is China gonna get food to feed its people?
The FDIC is not going to default on its obligations.
Knowledge is the enemy of fear
<< <i>The FDIC is not going to default on its obligations. >>
Not until it runs out of money. The FDIC is a funded by premiums that banks are required to pay to basically insure themselves. On Aug 5, 2011 the FDIC reported a balance of 45.5 Billion dollars in the fund. Total bank deposits is a very hard number to pin down, but it is estimated well into the trillions. With only 45.5 billion available to insure trillions in banking accounts, the FDIC would easly run out of money in even a small banking crisis.
If you think the "bailout purse string holders" will provide a bailout that is paid directly to the taxpayer (as would be required in this case), you ain't been paying attention for the last three years.
"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>China will have a MASSIVE civil war if the USA and Europe fail. Where is China gonna get food to feed its people? >>
From within. China produces more food per capita than does 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
and they import sugar
but I disagree that food production in the affected areas would be so affected that severe supply shortages would occur.
some entities with money would recognize the almost sure sales of plantings and fund them.
<< <i>
<< <i>I wish he had gone more in depth with his discussion of bank deposits and why people fear them. Any other writers out there in PM land have more learned discussion on the topic? >>
Informed depositors fear the future of their money sitting in the banks. The banks have legally loaned out deposits at a rate $33 to every $1 deposited (leverage), are surviving on bailout money while they payout incredible management bonuses, and have been allowed to present a completely false picture of their soundness with federally authorized radical changes in acceptable accounting standards. If and when one major bank starts to crumble (I believe it will be BoA) there will be a mad dash to all of them to get deposits out. It is believed that if depositors showed up all at once for only 5% of their money, the banks would have to lock their doors (bank holiday). Once a bank locks its doors, the rest will have to follow suit and probably remain locked for a while.
FDIC insurance is nothing more than a Public Relations commercial to make you feel your money is safe. FDIC is not physically able to cover more than 5% of all deposits. The whole banking charade is based on the expectation that not a whole lot of people will want to withdraw their money at any given time. One very bad day by one major bank will change that in an instant. A run on the banks will ruin them all within a few hours. A very limited amount of people would actually get their money.
When you deposit money into your bank account you have actually agreed to lend it to them. Federal Banking laws allow them to loan it right back out at many, many times its value. Based on recent bank performance in the area of loans and irresponsible spending (bonuses) do you begin to see the potential problem? Sprott is saying PMs are a logical, safe alternative and that more and more people are realizing it and this will result in higher demand and higher prices. Of course, the members here already knew this. >>
another sign may be an abrupt moving away from direct (electronic) deposits for those that can, although i think this will be a cascading effect as well as abandoning electronic banking.
<< <i>
<< <i>The FDIC is not going to default on its obligations. >>
Not until it runs out of money. The FDIC is a funded by premiums that banks are required to pay to basically insure themselves. On Aug 5, 2011 the FDIC reported a balance of 45.5 Billion dollars in the fund. Total bank deposits is a very hard number to pin down, but it is estimated well into the trillions. With only 45.5 billion available to insure trillions in banking accounts, the FDIC would easly run out of money in even a small banking crisis.
If you think the "bailout purse string holders" will provide a bailout that is paid directly to the taxpayer (as would be required in this case), you ain't been paying attention for the last three years. >>
The FDIC has an unlimited line of credit. Unemployment and other programs are taxpayer bailouts paid directly to the taxpayer.
Knowledge is the enemy of fear
<< <i>
<< <i>
<< <i>The FDIC is not going to default on its obligations. >>
Not until it runs out of money. The FDIC is a funded by premiums that banks are required to pay to basically insure themselves. On Aug 5, 2011 the FDIC reported a balance of 45.5 Billion dollars in the fund. Total bank deposits is a very hard number to pin down, but it is estimated well into the trillions. With only 45.5 billion available to insure trillions in banking accounts, the FDIC would easly run out of money in even a small banking crisis.
If you think the "bailout purse string holders" will provide a bailout that is paid directly to the taxpayer (as would be required in this case), you ain't been paying attention for the last three years. >>
The FDIC has an unlimited line of credit. Unemployment and other programs are taxpayer bailouts paid directly to the taxpayer. >>
True to a point.
the Federal Governement will "back up" the FDIC.
Unfortunately, the Fed. Gov't is also broke.
<< <i>
<< <i>China will have a MASSIVE civil war if the USA and Europe fail. Where is China gonna get food to feed its people? >>
From within. China produces more food per capita than does the US. >>
The USA is the #1 producer of corn, soybeans, chicken, beef. #2 in pork. #3 in wheat and fish.
Knowledge is the enemy of fear
<< <i>
<< <i>
<< <i>
<< <i>The FDIC is not going to default on its obligations. >>
Not until it runs out of money. The FDIC is a funded by premiums that banks are required to pay to basically insure themselves. On Aug 5, 2011 the FDIC reported a balance of 45.5 Billion dollars in the fund. Total bank deposits is a very hard number to pin down, but it is estimated well into the trillions. With only 45.5 billion available to insure trillions in banking accounts, the FDIC would easly run out of money in even a small banking crisis.
If you think the "bailout purse string holders" will provide a bailout that is paid directly to the taxpayer (as would be required in this case), you ain't been paying attention for the last three years. >>
The FDIC has an unlimited line of credit. Unemployment and other programs are taxpayer bailouts paid directly to the taxpayer. >>
True to a point.
the Federal Governement will "back up" the FDIC.
Unfortunately, the Fed. Gov't is also broke. >>
The G aint broke, but I know what you mean. I guess Europe is "more broke"?
Actually i believe the banks lost all our money in 2008. All the FED printing has just gone into replenishing your savings and checking accounts. The current value of PMs reflects this. Nothing new.
Knowledge is the enemy of fear
<< <i>The FDIC has an unlimited line of credit. Unemployment and other programs are taxpayer bailouts paid directly to the taxpayer. >>
Unemployment and other programs are funded programs. When the FDIC exhausts its very small funded account on the first 1% of depositors in a massive banking failure, it will have to turn to congress, as did the TBTF banks, for a bailout. There is a difference between a bailout and funded handouts - funded handouts give away money already on hand. Guess where bailout funds come from?
"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>What part of'' the Federal Government is broke ''do you not understand? >>
Technically he is very much correct - they will never go broke as long as they control the creation of money with no effective controls to keep them in check.
"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