Corus, Minn. bank busts bring '09 failures to 91 [FDIC Friday] [failure in Obamaville]

Market Watch ^ | 2009-09-11 | John Letzing

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SAN FRANCISCO (MarketWatch) -- Regulators closed Chicago-based Corus Bank N.A. and Woodbury, Minn.-based Brickwell Community Bank on Friday, bringing the number of U.S. bank failures this year to 91 and costing the federal deposit-insurance fund more than $1.7 billion as the credit crisis continues claiming victims.

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Failed Bank Information for Corus Bank, N.A., Chicago, IL

Failed Bank Information for Brickwell Community Bank, Woodbury, MN

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*Ping!*

[John W]

WSJ: Corus Bank failure is the second-largest this year; will cost the government between $1.5 billion and $2.4 billion in losses.

[unkus]

Any idea how much money is “supposedly” set aside in the FDIC to cover these things? Or, is the FDIC even supposed to cover this?

[sten]

I believe the FDIC is broke at this point... and we aren’t supposed to notice. Why? Because anyone receiving money from the FDIC is getting straight from the printer... This is why gold is going up like crazy

[unkus]

That’s what I thought. I have a friend at work who had about $7 k in savings/checking and he took out $3k to “put under the mattress”. Do you think he was prudent?

[javachip]

Per the latest FDIC CFO Report, at the end of June, the FDIC insurance fund was $10.4 billion.

In addition they had loss reserves of $18.3 billion - $8.0 b for future failures and $10.3 b to cover expected costs of banks that had already failed in '09.

Yes, the FDIC does need to cover the insured deposits in a bank failure. The bank that takes over the failed institution often picks up at least part of the tab.

If the FDIC fund were to/has run dry, there is no doubt Treasury will extend them a credit line.

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Don’t you fret now. That FDIC money is in a secure lock-box, just like the Social Security money for the elderly.

[PAR35]

I have a friend at work who had about $7 k in savings/checking and he took out $3k to “put under the mattress”. Do you think he was prudent?

That's not going to offer much protection against inflation. $3K won't buy much in hard assets. At that level, one should probably think food, ammo, and fuel.

[unkus]

That’s not going to offer much protection against inflation. $3K won’t buy much in hard assets. At that level, one should probably think food, ammo, and fuel.
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I told him it would be good to have that on hand if the banks closed for a “holiday”.

I dread to think where we will be a year from now.

[unkus]

Don’t you fret now. That FDIC money is in a secure lock-box, just like the Social Security money for the elderly.
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It’s just wonderful, isn’t it.

[jiggyboy]

Well that’s probably the last one for the year. The Federal Reserve said the recession is over, you see.

[sten]

having the money on hand is definitely prudent, although... as others have mentioned... it won’t protect against inflation.

of course, most of us hear ‘inflation’ and just blow it off. this is due to the fact that inflation was never much to worry about in the US. well... some people think gold, which just broke $1010/ounce, could hit $2,000/ounce by the end of the year (i’d even consider november). if that happens, what your buddy can buy today for $1500 will cost him $3000. that would be real inflation and will crush the savings of everyone in the US (ie: the top 25% of the earners... those 0bama is trying to hurt the most)

i have told people i know to stock up on their storm supplies. 2-6 weeks of general/dry goods, batteries, etc. stuff that will last for months. will the worst happen next week? 2 weeks? a month from now? no idea. (my guess would be when the banks starting getting hit with the $3.3 trillion in defaulting commercial loans. that’s a lot to lose each month) best to be prepared.