June 5th Reverse Money Bomb -- withdraw your funds?
Posted May 13th, 2008 by IamVoting4RonPaul
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THIS IS HORRIBLE!!!
The banks are ALREADY hesitant to lend to each other, and that's why the FED keeps promising to make more cash available as needed. Something like this could be a detrimental blow to the financial sector, and we could be BLAMED for the effects which in a worst case scenario would be collapse of our economy by rapidly crashing the dollar.
no thanks
All I use banks for is a small checking account and I would not want the gyrations of trying to plan for a zero balance for 10 days! I suppose if someone had a $50,000 CD parked in a bank that would be much easier.
No! This is horrible!
It's like yelling fire in a crowded movie theater!
This could snowball into something that causes consiquences bigger then we can handle or want to be associated with.
Just imagine a 2rd depression BLAMED on Ron Paul!
Please, we do not want to cause problems, we want to fix them.
This is NOT peaceful and could go bad, real bad.
It breaks my heart that the video is even out there. If the banks and MSM could blame this on us, it would be soooo detrimental to our battle. I just think if the banks go bad, we should let them, not provoke it.
Holy crap!!!!
Do you realize what will happen if this thing catches on and goes viral.
Do you think they would be prepared?
If they are smart and catch wind of this, they would just print more money and send it out to the banks.
Printing won't help
The issue isn't the physical money supply, but rather the inability to meet reserve requirements. If enough people withdraw money from a bank, weather in physical form or electronic, that bank will be forced to sell off assets and call in loans to make up the reserver requirements. If the bank cannot meet reserve requirements, it will have to either borrow the money or fail.
They may be able to borrow money from the Federal Reserve to meet requirements, or the Fed may reduce reserve requirements. They could even allow banks to hold NEGATIVE reserves temporarily until this is sorted out. I would really like to hear from someone with more knowledge in this area. What recourse do the banks have? Will the Fed be able to help. I know Congress probably won't be able to act fast enough, unless they plan ahead.
From what I understand, the Fed is already reaching to keep things glued together, and many banks don't have the assets to sell to counteract this. There are already 1,000 people signed up for this and nearly 5000 views on YouTube. Maybe the government/banks will just prohibit withdrawals during this time, but that is likely to create panic.
I unsderstand that but,
don't you think they would do anything to give the appearence that everything is O.K. Including printing money and simply loaning the paper temporarily to the banks so that they could handle the withdrawls.
Freedom or Martial Law?
This sounds like a good idea, but it may be the perfect excuse for Bush to declare martial law. Depending on how many participate and the average balance of their accounts this could destroy between one and several hundred billion in capital (back of a napkin math ;). There is a good chance that it will create mass panic. The end result (if enough people participate) could be massive deflation of the money supply. This will plunge us into a depression similar the Great Depression.
Our economy is currently balanced on the edge of a knife. On one side is hyper-inflationary recession/depression; on the other is deflationary depression. The easiest thing to do has been to maintain the balance, but huge pressure is building up on both sides. One small push in either direction could spell disaster. We may be able to force the financial system into a deflationary downward spiral, but what good will it do? Maybe we won't break anything, but have just enough of an effect to get congress to seriously consider change. I think this is unlikely given the response to the housing bubble and the derivatives markets. The response could just as easily be martial law, food rationing and the end of our democracy. Are there other options?
Ron Paul's plan calls for legalization of competition between sound monetary standards (presumably) set by congress and the Federal Reserve System. In order for this to happen, however, we will need to not only get Ron Paul the presidency, but the support of Congress. The only other option is to wait and see how it plays out. This option, however leaves it up to the Fed and the bankers. I am torn on this issue. Does anyone else have any useful insight or oppenions?