Forgive me for getting tinfoily on you all, but...

[beppu]

PUBLIC SERVICE ANNOUNCEMENT:

http://globaleconomicanalysis.blogspot.com/2009/08/as-of-friday-august-14-2009-fdic-is.html

If you have money in American banks, it might be prudent to get your
cash out soon-ish (and maybe even convert it to something else).

[Brock]

Bah. There are several issues with this concept.

1) The article suggests we'd be better off without the FDIC (let failing banks
fail! the depositors were stupid enough to invest with them, well then so be
it. free market!). The problem here is that nothing has changed for the
non-stupid investor. One should still invest in banks that you feel are using
best practices, FDIC or not. Both the bank failing and the FDIC failing still
fit in fine for this model.

2) What you suggest is effectively Bank Runs. Historically those are a very bad
idea (and what the FDIC has slowed significantly!) In fact, I'd say that bank
runs themselves hurt us during the Great Depression as much as the stock crash
itself. History shows us that we didn't have major bank runs even during the
savings and loan crisis of 1980's and 90's, because of the FDIC. So -- before
FDIC bank runs that made a bad situation worse, after FDIC no bank runs.

and of course (3) the FDIC has actually added some extra fees for member banks
to bring their reserve percentage back up to a safe standard by the end of the
year. So yes they know that their reserve is low and it needs to be higher, and
they're trying to fix it. There was a recent bill that lets the FDIC borrow
from the treasury (up to 100billion I believe). That would hold them over until
their higher-fees (and the fees _should_ be higher in this economy) bring the
reserve rate back up.

I know the situation is more complicated than I paint it... but I also know
it's more complicated than you (or the article) paint it too... the simplistic
"pull your money out" is just as foolhearty as my simplistic "have faith!".

--Brock

[Terrence Brannon]

I'm curious, what are you planning to do in light of this knowledge?

I think it's time to pack up and move to India, where you can live on
6,000/year like a king :)

Japan, especially Tokyo is a very expensive place to live.

Pretty soon, nature will rule the earth and all manmade systems
(including Perl) will crumble to dust and be forgotten about.

Then we will start thinking and trying to outdo nature once again.

[beppu]

On Aug 16, 3:28 pm, Terrence Brannon <metap...@gmail.com> wrote:
> I'm curious, what are you planning to do in light of this knowledge?
>
> I think it's time to pack up and move to India, where you can live on
> 6,000/year like a king :)
>
> Japan, especially Tokyo is a very expensive place to live.
>
> Pretty soon, nature will rule the earth and all manmade systems
> (including Perl) will crumble to dust and be forgotten about.
>
> Then we will start thinking and trying to outdo nature once again.

My plan would be to go hang out with these people:

http://www.wwoofjapan.com/main/index.php?lang=en

Apparently, there are a bunch of organic farms in Japan (and elsewhere
in the world) who will feed you and give you a place to sleep in
exchange for some work. (No money changes hands.) If SHTF, I would
want to be far away from big cities and have food readily available,
and these farms satisfy that requirement. I'd like to know more about
growing my own food anyway, and this seems like a good way to learn.

As for my savings, they're pretty paltry, but a good chunk of it is
out of the bank and split into gold, silver, and yen just in case the
US dollar runs into some serious trouble.

Hopefully, it will be enough to get me out the country, because I
don't plan on sticking around if things get bad.

--beppu

[beppu]

You do what you think is right. I don't have much faith in the powers
that be, but if you do...

(Honestly, I wish humanity didn't rely on money so much. I don't like
having to think about money, and I don't like that society is
structured so that we're totally reliant on money for basic
necessities, but that's a discussion for another thread another
time....)

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