Archive for the Bail In Category

They Can Print Money (November 2, 2015)

Posted in Bail In, Bailout/Bribe, Bankruptcy, Banks and Banking System, FDIC, Federal Reserve, Kleptocracy, TARP, Wall Street on November 2, 2015 by e-commentary.org

. . .

Q          “The FDIC can simply print money.”

B          “Maybe.  However, the response to the Big Jolt may be . . . nuanced?  By the government?  Let me explain.  Or at least confuse the issue.”

. . .

Q          “By any metric – economically, morally, psychologically, ethically, metaphysically, generationally – TARP was a grand fraud perpetrated on the American people.  And the central message is crystal clear – everyone in power knows that there are no limits or restraints of any kind to government criminality at the top.  They can simply print money.”

B          “Maybe.  During what I call the Financial Crime of 2008, the government could have nationalized the banks, but those in power allowed the banks to nationalize the government, in particular the Federal Reserve and the Treasury Department.  The Fed and Treasury now have carte blanc to do anything that serves the interests of their Owners on Wall Street and with the Big Banks.  However, the FDIC may not have that absolute freedom and immunity from liability and accountability.  The bureaucrats in the bureaucracy at the FDIC bureaucracy may behave like bureaucrats.  Some risk-averse bureaucrat may seize up and say that she or he will not make the decision to commit the agency to exceed its authority because he or she may not have enough stroke to obtain immunity.”

Q          “The most risk-averse course of action still is to print money or create electrons.”

B          “Maybe.  The Owners have agreed that ‘bail ins’ are the answer to their self-created problem.  At some point, however, even J. Q. Public may say ‘bastante’ and swing by the bank and demand his or her deposits.” 

Q          “They will hand out a plastic card in lieu of physical cash.  Print money or produce plastic.  There is no difference.”

. . .

B          “Maybe.  Except that the fundamental problem today is not liquidity, it is solvency.  The system is insolvent.  Printing more money is akin to distributing cigarette butts.  The bucks, like butts, soon will not be cherished.”

Q          “At that point, we may be bartering cigarettes.”

B          “Maybe.  If they are available.”

. . .

[See the e-commentary at (M)End The Fed (July 11, 2011).]

Bumper sticker of the week:

Give a man a gun and he can rob a bank; give a man a bank and he can rob the world

USA, FDIC, Or NCUA? LCU? SPCU? (October 19, 2015)

Posted in Bail In, Bailout/Bribe, Banks and Banking System, Boycott Series, Collapse, Credit Unions, Debt/Deficits, Depression, Dollar - World's Reserve Currency, Federal Reserve, Gold, International Finance, Kleptocracy, Money, SDR - Special Drawing Rights, Silver on October 19, 2015 by e-commentary.org

. . .

B          “I want out of the Racket – the stock market Racket.  I want to hold my deferred compensation in the form of dollars, for what they are worth.  As I see it, Treasury Bills and Treasury Bonds are allegedly protected by the ‘full faith and credit’ of the United States.  What is that worth?  When the Big Jolt hits, what is Uncle Sam’s telephone number?  Or e-mail address?  unclesam@unclesam.gov?  A general promise by the Uncle when I have full faith that the credit of the United States is sketchy, provisional and conditional at best.  I won’t touch Treasury Bills or Treasury Bonds.”

C          “Another hollow and worthless promise.  I won’t touch Treasuries and refuse to deposit money in a bank.  The FDIC (Federal Deposit Insurance Corporation) allegedly provides insurance for banks, yet the agency is ‘stressed’ to put it mildly and will not pay all claims in the event of a significant bank run.  The NCUA (National Credit Union Association) allegedly provides insurance for credit unions and may provide some insurance protection for some time for some depositors.  I am willing to make a tentative commitment to the system and keep some of my funds in my Local Credit Union (LCU).”

B          “Depositing a healthy chunk of money in the Sealy Posturepedic Credit Union (SPCU) involves little counterparty risk and allows me to sleep peacefully at night.  When the Big Jolt hits, there will not be enough physical dollars.  Regular folks may accept regular dollars for two related reasons – inertia and habit – until the shock triggers them to do something and change their habits.  Regular folks will accept the few available physical dollars for four or six or eight weeks for transactions as long as other citizens accept dollars for transactions.  Then regular folks will only accept Sacagawea dollars and some coins for a few weeks, although coins like dollars of any kind are in short supply today.  After a few more weeks, some informed folks will accept silver coins minted before 1964 at a premium.”

C          “In the end, the Depression is our guide.  Twelve gauge shot gun shells may be another medium of exchange and twenty-two rounds may be used as change to support the emerging barter economy.  Cash of any kind is the threat to the those who run System.  The government now requires banks to obtain and record the identity of anyone making a cash deposit and are refusing to accept cash for some payments.”

B          “Banks do not need deposits to be able to loan money.  Yet today many banks are offering gimmicks and gewgaws to attract funds that they will be able to retain during a ‘bail in’ without any obligation to the depositor.”

. . .

C          “Junior’s paper route money stored in his piggy bank may be our only available liquid asset.”

B          “She may not stand for us withdrawing some of the Standing Liberty quarters from the collection she has accumulated with her baby sitting money.”

C          “We may need a bushel basket of Wheat Pennies to buy a pocketful of wheat.”

B          “When the banks are maneuvering to avoid a haircut, we may be required to go to our Barbers.”

. . . 

[See the e-commentary at Preserve Cash; Preserve (Some) Privacy (May 4, 2015), “Bail Ins” Are Globalized; “Bail Outs” Are Bailed Back In; No Bail For Bankers (December 29, 2014), Globalizing The Bail In (July 8, 2013), Bailouts: Out; Bail Ins: In; Slowly Boilin’ The Frog (April 15, 2013), Money “In The Bank” Or “Under The Mattress” (October 8, 2012), Boycott Big Banks – Vote Your Dollars (November 21, 2011), and Boycott Big Banks (February 1, 2010).]

Bumper stickers of the week:

The U.S. government is pursuing an international currency war and a domestic war on currency.

SPCU/You > LCU/NCUA > Bank/FDIC > Uncle Sam/FF&C

Prepping: Public And Private Perspectives (April 27, 2015)

Posted in Bail In, Bailout/Bribe, Bankruptcy, Banks and Banking System, Collapse, Debt/Deficits, Depression, Economics, Global Climate Change, Guns, Population, Recession on April 27, 2015 by e-commentary.org

. . .

C          “A system that cannot go on forever will not go on forever.  The System in its current incarnation cannot go on forever.  Thus, the debate shifts fundamentally from ‘if’ to ‘when.’  The syllogism suggests that fundamental change is in store.  Do we have the stores?”

D          “‘When’ not ‘if’ and also ‘what.’  Plan B is by definition less desirable than Plan A or presumably it would be Plan A.  The most desirable plan is failing.  What is Plan B?”

C          “The other systemic challenge is weather.  That problem like the financial machinations is also substantially man-made and man-modified.  Mother Nature allocates every region a specially-tailored natural catastrophe.  Florida and the Southeast get hurricanes, the Midwest gets tornadoes, the West Coast gets earthquakes, other regions get typhoons and cyclones.  And Mother Nature is shifting the script so that some areas get floods and some get drought.  The jet streams and the gulf streams are working in tandem to change things on the ground.”

D          “Leaves you wondering what is Plan B?”

. . .

C          “The script never varies.  The public Emergency Preparedness offices provide detailed lists of necessary supplies and valuable advice yet always unfailingly avoid even hinting that a gun, even one for hunting squirrels or pigeons, is a wise and prudent investment.  Some of them are reluctant even to mention acquiring a knife other than a pocket knife or perhaps a scalpel.”

D          “And the private sector prepper sites go to the other extreme and focus the entire discussion around guns and ammo and ammo and guns and guns and ammo.  The alpha, the bravo, the charlie and the delta of preparation for the Great Omega.”

C          “Get a gun.  We have a moral duty to protect our family and friends.  And get an LED flashlight.  And extra batteries.”

D          “And beans and bullets.  My personal Plan B combines public and private sector suggestions.”

. . .

C          “Going it alone is a failure from the start, yet desperately few humans have the intellectual and emotional software to engage others cooperatively.  Finding others who have resources, skills and tools is not promising.”

D          “At heart, the most prudent preparation is to restrain the dragons in our soul to free our mind.”

. . .

[And this past weekend, earthquakes in Nepal.]

[National PrepareAthon! Day on April 30 is a grassroots campaign for action to increase community preparedness and resilience.]

[See the e-commentary at Beans and Bullets (April 6, 2009), We Ain’t Ants; We Are Grasshoppers (April 9, 2012), On Community (June 3, 2013) and On Roiling And Rolling Collapse (March 9, 2015).]

Bumper stickers of the week:

Get a garden rake, get a gun, get a grip

“If you want to awaken all of humanity, then awaken all of yourself; if you want to eliminate the suffering in the world, then eliminate all that is dark and negative in yourself. Truly, the greatest gift you have to give is that of your own self-transformation.” Attributed by some to Lao Tzu, but who knows.

Interest Rates ‘risin’? (March 30, 2015)

Posted in Bail In, Banks and Banking System, Credit Unions, Debt/Deficits, Federal Reserve, Stock Market on March 30, 2015 by e-commentary.org

. . .

1          “Can they.”

2          “May they.”

1          “Could they.”

2          “Should they.”

. . .

1          “The Federal Reserve cannot allow interest rates to rise because the Federal Government would be obligated to pay staggeringly more interest to service the ever metastasizing National Debt.”

2          “Someone in the Bureaucracy must be sober enough to realize that a rise in rates will trigger profound and devastating economic and financial consequences.  Everyone will need to look up the word ‘derivatives’ in the dictionary.”

1          “I could see the Federal Reserve raising rates by ‘25 basis points,’ as they say, to show that they cannot do nothing.  If they appear effete, they are effete.” 

2          “Even a quarter percent rise may be enough to tip over the economic and financial game.  Perhaps in desperation the Fed can generate real inflation then the Federal Government can pay the interest on the National Debt with deflated dollars . . . which reduces the real cost to the Government.”

1          “The Federal Reserve does what it wants to do, but its primary mandate is to maintain price stability.  Inducing gross price instability is directly contrary to its raison d’etre.  But then, do they care?”

. . .

2          “The dollars may not be worth anything in a few years, yet I will not pay money to store my money in a bank and also risk having my money confiscated by the bank to pay the debts of the bank.”

1          “When they slither from the ZIRP – zero interest rate policy – to the NIRP – negative interest rate policy – and start charging me to keep my deposits in their failing financial institutions, I am tucking all of my money in the Sealy Posturepedic Credit Union.”

. . .  

[See the e-commentary at Money “In The Bank” Or “Under The Mattress” (October 8, 2012).]

Bumper stickers of the week:

Compound interest is described as the greatest invention of the 20th Century, yet it may be the most vexing challenge confronting governments in the 21st Century.

“The first panacea for a mismanaged nation is inflation of the currency; the second is war.  Both bring a temporary prosperity; both bring a permanent ruin.  But both are the refuge of political and economic opportunists.”  Ernest Hemingway, “Notes on the Next War:  A Serious Topical Letter,” Esquire, September 1935

What goes down must go up?

ZIRP (Zero Interest Rate Policy) = Official National Policy . . . for all time?

NIRP (Negative Interest Rate Policy) = the straw that breaks

“Bail Ins” Are Globalized; “Bail Outs” Are Bailed Back In; No Bail For Bankers (December 29, 2014)

Posted in Bail In, Bailout/Bribe, Bankruptcy, Banks and Banking System, Congress, Dodd-Frank, National Defense Authorization Act / FY 2012, Volker on December 29, 2014 by e-commentary.org

. . .

J          “Dodd-Frank (July, 2010) said ‘no’ to more ‘bail outs’ by the public for the ‘too-big-to-fail-and-too-big-to-jail’ Banks and then the Federal Reserve (December, 2012) said ‘yes’ to ‘bail ins’ by the depositors and then the G20 Nations (November, 2014) said ‘heck yes’ to ‘bail ins’ by the depositors and then Citicorp-Congress (December, 2014) said ‘hell yes’ to more ‘bail outs’ by the public for derivatives and other junk.  So many Christmas gifts, so little time.”

K          “Back to a ‘bail out’ of the Wall Street Bankers including all the junk bonds . . . that fuel the American shale oil boom.  That did not take long to cover them for their exposure in the Great Gas War.  The people, the pensioners and the depositors will suffer existential losses when the derivatives collapse.”  

J          “Citicorp-Congress also delayed implementation of the ‘Volker Rule’ that would provide for increased capital ratios and mark-to-market valuations.  Citicorp-Congress gave the ‘one-two punch’ to the public.”

K          “K.O.’d for Christmas.  All I got for Christmas is my two front teeth.  Knocked out.  By Congress.”

. . .

J          “The plaque proclaims that your deposit is insured up to $250,000 by the FDIC.  Everyone is fooled, yet no one is protected by the plaque in a serious financial plague.  When the Big Banks and their partners in crime on Wall Street fail, the FDIC will not be able to provide insurance for the depositors who are now on the hook.  Line and sinker.  Now on the line, the bottom line is that the depositors must ‘bail in’ the Big Banks and the public must ’bail out’ Wall Street.”

. . .    

[See the e-commentary at Bailouts: Out; Bail Ins: In; Slowly Boilin’ The Frog (April 15, 2013) and Globalizing The Bail In (July 8, 2013).]

Bumper stickers of the week:

We should be doing something to make the bankers worry about getting bailed out.

18 T Debt; 18 K Dow

Plus 4 T “Federal Reserve Debt” = 22 T “Federal Debt”

Plus 9 G (Gazillion) in Derivatives = some trouble

The Capitol Building on Jenkins Hill is now renamed the “Citicorp Dome”

And then take a look at the National Defense Authorization Acts of 2012 and 2014. 

Financial History:

1998:            Banks/Wall Street bail out Long Term Capital Management

2008:           Federal Reserve bails out Banks/Wall Street

201_:            International Monetary Fund bails out Federal Reserve; Taxpayers bail out Banks/Wall Street

201_:            God bails out the International Monetary Fund; No one bails out Taxpayers

201_:            God files Chapter 11 Reorganization; Taxpayers file Chapter 7 Liquidation

So, help us God, so help us God.

Punt, Pass And Kick: The End Is Far (February 24, 2014)

Posted in Bail In, Bailout/Bribe, Banks and Banking System, Gold Standard, Kleptocracy, Money on February 24, 2014 by e-commentary.org

. . .

C2        “An unsustainable system is sustaining itself.  Somehow.  Yet, in the end, an unsustainable system is unsustainable.”

C1        “Everyone is engaged in a grand ‘punt, pass and kick’ game to punt his or her personal or professional responsibility, pass the buck, and kick the 55 gallon rusty drum down the pot-holed road and over a structurally unsound bridge, yet the system is stumbling and bumbling along.  They continue to build ‘bridges to nowhere’ and allow existing ‘bridges to somewhere’ to decline and decay.”

C2        “To build a sustainable bridge, we must do something as simple and foresighted as using stainless steel rebar to support the structure so that it does not rust and rot from within.”

C1        “When the 55 gallon oil drum is empty, it will be much heavier and harder to kick down the road.  We may not make the bridge.  Will time expire on the ‘punt, pass and kick’ game without a possibility of overtime.”

C2        “We may get ‘sudden death’ overtime, although we may be deceased.  We cannot argue with success.”

C1        “As long as you succeed.”

C2        “Some folks will argue with failure, but it may be too late.”

. . .

C1        “We cannot peer behind drawn curtains or peak behind closed doors.  At best, we may observe some developments while trying to assemble a puzzle with only a few random pieces operating in the dark with one hand tied behind our back.”

C2        “On a good day.  We interpolate and extrapolate with little information and confront an active effort by a variety of folks to mislead and deceive.  A conspiracy requires too much cooperation, but a confluence of powerful interests responding to the same incentives and acting in concert to acquire lucre and power can cause mischief.”

C1        “What is today’s exchange rate between lucre and power?  A desperate cabal trying to stave off a large creditor or interest could loot the Treasury.  When there was some chatter about the United States not returning all the gold in the Federal Reserve vaults to Germany because the gold had been sold, little was said.  Big players do not air their tainted laundry in public.  What if the gold is not there?”

C2        “You could craft a movie around a discovery that all the gold in Fort Knox will not buy a twenty-five cent cup of coffee.”

C1        “Gold has mesmerized men through the ages, although it does not taste particularly tasty.”

C2        “Even with golden mustard.  And it does not wear well.”

C1        “If ‘He who has the gold makes the rules,’ what if there is no gold?” 

. . .

C1        “The Big Jolt may come when ordinary folks are spooked by something, rational or irrational, and try to withdraw their deposits from financial institutions.  When it first senses a possible problem, the Federal Reserve will send a directive in seconds to all financial institutions limiting withdrawals to a small sum and then, if that does not work, allowing financial institutions to print script of some kind on site to give to depositors seeking to withdraw their funds.” 

C2        “That script may not be acceptable.  At that point, the script would be backed by the half faith and hollow credit of the United States.”

C1        “An old banker reflecting on the start of the Great Slide looked out the window at depositors who demanded their money and felt an overwhelming sense of terror.  Their terrified look triggered his terrified look.”

C2        “Their terrified look may trigger more than a terrified look.”

C1        “Look out.”

. . .

C2        “A ‘Bail In’ is likely to trigger the same reaction unless it is done very slowly with little publicity so that no one notices.”

. . .

C1         “Something may be done or may happen to jeopardize the dollar’s position as the world’s reserve currency.  That will have a bad ending.  Try to explain what has happened and will happen to the ordinary citizen.”

. . .

C1        “I am convinced that the clearest lesson in American history is the absolute conviction that no one in the banking and financial industry who loots and robs the public will ever be convicted let alone even indicted for a crime.”

C2        “We might as well enshrine it in a constitutional amendment – the Kleptocracy Amendment.”

C1        “Because of our actions and inaction, we are fundamentally in worse economic shape now than we were in September of 2008.  What do you think, three more years or ten more years or could the ‘punt, pass and kick’ game sustain for thirty more years.”

C2        “A riot could become a rebellion and then an insurrection.  Enough people and places are festering and percolating to spark and provide the tinder.”

C1        “The catalyst may not be economic or financial.  A computer virus could go viral or a virus could go viral.”

. . .

[See the “e-ssays” titled Beans and Bullets (April 6, 2009) and Bailouts: Out; Bail Ins: In; Slowly Boilin’ The Frog (April 15, 2013) and those collected under https://e-commentary.org/category/gold-standard/.]

Bumper stickers of the week:

You can argue with failure

Crime pays in America, but only big crime

Something that cannot go on forever will not go on forever

Federal Reserve Note legends on dollars, 1928 and 1934 and 1953 and 2014 and ____:

REDEEMABLE IN GOLD ON DEMAND AT THE UNITED STATES TREASURY, OR IN GOLD OR LAWFUL MONEY AT ANY FEDERAL RESERVE BANK

THIS NOTE IS LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE, AND IS REDEEMABLE IN LAWFUL MONEY AT THE UNITED STATES TREASURY, OR AT ANY FEDERAL RESERVE BANK

THIS NOTE IS A LEGAL TENDER AT ITS FACE FOR ALL DEBTS PUBLIC AND PRIVATE

THIS NOTE IS LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE

THIS NOTE IS . . .