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US Bank Run Imminent as FDIC Expanded Deposit Insurance Ends Dec 31st

US Bank Run Imminent as FDIC Expanded Deposit Insurance Ends Dec 31st
As of January 2013 the FDIC stops offering 100% coverage for all insured deposits. That amounts to $1.6 trillion in deposits, 85-90% deposited with the TBTF mega banks. Once the insurance ramps back to $250,000 the FDIC risk amelioration offered to large depositors will cause them to flee from the insecurity of the much reduced FDIC coverage. This money will rotate immediately into short term Treasury securities. The treasury, in order to handle this flood of money, will immediately offer negative interest rates. This financing will resemble the .5% negative interest rate offered by the Swiss and Germans on the funds flooding to their banks from Spain, Greece and Italy.
This will be a bank run much larger than the Euro banks flight to safety.

I have noticed two disturbing matters that will most certainly come

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100% coverage ending will not spark a bank run. Who's saving?

Ending Unlimited 100% coverage will not spark a bank run! Who has cash savings of more than 250,000 dollars anyway? What does one get for a return on such savings, 0.00003%?

The Zero Interest Rate Policy that's driven down our rewards for capitalizing the banking system with, uh, capital, forced big savers into risky stocks and commodities a long time ago.

SO much so, that 250,000 is probably overkill. They might as well restore FDIC to 100,000 like it was until when, 2005?

Even when it was 100,000 coverage, I recall my great-uncle moaning, "Who's FDIC kiddin? They DON'T have enough money to cover everyone up to $100,000!"

That was in the days before Helicopter Ben, I guess....

"Cowards & idiots can come along for the ride but they gotta sit in the back seat!"

No. I don't recommend an idiomatic run to... nor from a bank.

I hope that come what may, you folks continue to appreciate your neighborhood credit union. Credit unions, you might observe, do not participate in the wholesale looting of our public purse... The Treasury.... or what's left of it. FDIC negative balance. Bailout. Fed 0% loans.

When you grow weary of bankers acting like gangsters, perhaps you may enjoy reading up about the original article: Top 20 Most Successful Gangsters None of them rake off as much of you money as the "Too Big to Fail" failing banks, but gangsters have their own story to tell.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul

Idiots! An idiotic expression to be sure, "Run to the Bank."

Idiomatic it seems are not answers to prayers.

USA Banking System, Federal Reserve, and FDIC News and Analysis FDIC Non-Sufficient Funds... NSF for 7 Quarters. Negative. Broke!

Conclusion: The FDIC Deposit Insurance Fund (DIF) balance balance has turned positive after 7 consecutive quarters with a negative balance. The PIL has been negative, a negative expense, 4 of the past 5 quarters. ... However, the FDIC problem bank list remains extremely high which indicates ongoing bank failures and DIF costs. Bank failures and the related charts of total failures and cost to the FDIC Deposit Insurance Fund are posted weekly on this blog.

About the FDIC

Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's banking system. The FDIC insures [with a "pass the hat" contribution of your]deposits at the nation's 7,575 banks and savings associations and it promotes [you blindness to the risks &] the safety and soundness of these institutions [... not you...] by identifying, monitoring and addressing risks to which they are [leaving your deposits] exposed. The FDIC receives no federal tax dollars [sse: "pass the hat" contributions of your deposists] – insured financial institutions fund its operations.

Notice: FDIC is not regulated by state insurance laws nor commissions.

FDIC DIF Cannot Cover All Deposits (Deposit Insurance Fund (DIF: What's the dif?)
Submitted by NY4RP on Sat, 08/18/2012. Mark Twain commentary included.

Disclaimer: Mark Twain (1835-1910-To be continued) is unlicensed. His river pilot's license went delinquent in 1862. Caution advised. Daily Paul


You forgot to include all that credit created by these banks is through the fractional reserve system. Your deposited money of exchange (which has blood, sweat and tears collateral), the bank gives credit in return, or money of account ( which has no collateral ) Banks like most other public institutions utilize GAAP or Generally Accepted Accounting Principles. The hedge in this system is private commercial paper. A little more complicated than that but the dollar is just an IOU. Original signature applications have been the means to bonding and securitization for nearly 100 years and if you read the FEDS Modern Money Mechanics, actually has value.

Just one last kick in the nuts, then a final deathblow

Cyril's picture



"Cyril" pronounced "see real". I code stuff.


"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Congress will extend it

Congress will extend it, no question

Yup, nothing moves those

Yup, nothing moves those congressional whores faster than the banks needing their asses saved. Not offence meant toward ho's.

No doubt you both are right


God grants liberty only to those who love it, and are always ready to guard and defend it. – Daniel Webster

Cyril's picture

Opting Out Smoothly

How to opt smoothly out of the system. I've done it, I'm no genius, was just a one-time household homework effort.

Being married with a spouse you can fully trust helps a lot.

1. pay off as much debt as you have and as you can; do it in few big chunks or on longer payments, doesn't matter; just do it

2. work out your household budget allocations and payment dates thoroughly, so that point #4 can work eventually

3. live on cash; pay everything of new assets on cash; throw away your credit cards once they re paid off; don't create any new debt

4. the idea is if pay day is Pn, then by Pn + 24 hours, you have ALREADY emptied your checking accounts for paying the current and next due bills; for instance, my balance IS SYSTEMATICALLY below $100 FOR 29 DAYS out of 30 in a month; savings account has been emptied and converted to silver long ago; the $100 are for my bus to work and cigarettes; when the next Pn+1, I am back to close to ZERO balance (from previous $100, downwards)

5. save and convert as much as you can into silver; on this end, this represents 20% to 25% of the bring home income EVERY PAY DAY

even if it's just half a dozen ounces a month : JUST DO IT ! ... while you can.

6. find a safe location to stack it on and never disclose it

Never overdraw your account; if bank forces you, put a low balance alert threshold as low as possible, say 5 bucks, so you know you won't go below it and the back office system will never get curious about noticeable movements; don't give any explanation to your banker, ever.


"Cyril" pronounced "see real". I code stuff.


"To study and not think is a waste. To think and not study is dangerous." -- Confucius

I don't usually tell people

I don't usually tell people what to do, but please quit smoking the cancer sticks home boy. We can't afford to be losing paulbots to something as avoidable as self-induced lung cancer.


I have been thinking the same thing

I need to quit too, but really really hard


attempted 3 times to quit. I know your pain, I don't even really enjoy it anymore. I just can't seem to stop. :/

I finally quit smoking

Here's what I did....I hope it helps someone!!!

I bought the nicotine gum, I could not quit cold turkey. Especially needed that buzz in the morning.

Also, RICOLA cough drops! They have lots of herbs in them that help clear out the toxins in the lungs etc. Also, it helps to keep your mouth busy.

Don't be hard on yourself if you haven't quit yet! Keep trying! It took me 3 or 4 times before it stuck. It's know been more than a decade.

Remember, they purposely put chemicals in the cigarettes to keep us addicted. It's not just the tobacco that Grandpa smoked.

Good LUCK!!!

My grandpa had his lung

My grandpa had his lung removed 3 days ago on account of lung cancer.

Use the FRN's to buy junk silver instead- at least you will still get a small endorphin rush.

Another practical reason for quitting would be to deny

the neocons all that tax revenue. If you have to smoke something, move to Colorado or Washington and grow your own. :)

The individual has always had to struggle to keep from being overwhelmed by the tribe. If you try it, you will be lonely often, and sometimes frightened. But no price is too high to pay for the privilege of owning yourself.
Friedrich Nietzsche

Cyril's picture

Lol. Okay, thanks. Dear wife will agree with that

Lol. Okay, thanks. Dear wife will agree with that... ;)

"Cyril" pronounced "see real". I code stuff.


"To study and not think is a waste. To think and not study is dangerous." -- Confucius

I used this trick to quit a

I used this trick to quit a bad habit of mine:

Every time I had the urge to spend money on my bad habit, I would go to the local coin shop and spend that money on silver instead. It worked, sort of. Now I am addicted to buying silver!

it is coming

be prepared!