Posted on 10/21/2011 10:00:33 PM PDT by oneolcop
This is something that should concern the OWS crowd, but we also need grown ups like the Tea Party to make a blunt statement that BoA should not be bailed out.
My 401 does. I can’t change that now.
This IS a backdoor bailout, already.
The FED went over the heads of FDIC. The FDIC wanted nothing to do with this.
This was arranged so that the taxpayers take the brunt of the damage. Do you really think Congress can vote to NOT save ALL those deposits of BofA customers?
This is to put the politicians between a rock and a hard place.
And all you Freepers who think your save because you could still access your BofA accounts, wake up!!!!!
Words mean things, and vicious and vituperative instructions to obedient people have consequences.
I suspect (but do not know for sure) that B of A was having "issues" anyway; and that the Durbin venom may have poisoned a flicker of a recovery.
Speaking of recovery, if B of A swan dives, it would be yet another anchor on our foundering economy.
.
Round up the usual suspects.
Normal accounts are FDIC insured to $250,000.
So how is it people with normal checking/savings accounts will lose their money if BofA dies?
As I understand it BofA was poisoned with the purchase of Countrywide which happened because the Fed demanded BofA buy it.
Having been with B of A for decades, I am in the process of closing my account and switching to Charles Schwab Bank, a great online bank. BofA should prepare for a bank run.
What makes you think the FDIC has any money?
All those banks they have been closing? Since 2008?
The government would have to back up the FDIC.
That is why the FDIC was against it. The derivatives are bigger than the FDIC.
The FED’s won, and they want their bailout. One way or another.
I just got a letter from them yesterday telling me one of my mortgages (on an investment property) had been transfered (to a company in IL). I called the new company to get my new acct# so I could schedule my November payment. I asked about another BofA mortgage I have on another property and was told perhaps in another batch of 100K mortgages they’re transferring over in December. She also said they’re all “primary lien” mortgages (whatever that means).
Here, this is where the failed banks get posted on FDIC friday:
http://www.fdic.gov/bank/individual/failed/banklist.html
Four banks were closed today.
I guess $5 a month wasn’t enough.
And no one with a checking/savings account at those closed banks lost a dime.
Normal people used to mean taxpayers, but for the 47%, it means their tax money goes to pay back those who have assets in insured accounts, as all those assets just got soaked up by paying off the parties to the derivatives. Remember, you don't put your money into a bank, you loan it to the bank to do whatever it please, with the understanding that you can call that loan at any moment. (liquidity of account.)
The fewer assets in the bank when it implodes, the less of a payout the taxpayers have to do, unless Congress suddenly wakes up tomorrow and forbids the taking of FDIC insured assets to pay derivatives. Which won't happen, I'm sure. Too many liberals (R or D) want to give another boon to the banks.
Deposits on a failing bank are guaranteed through fees collected by the FDIC. The FDIC can probably pay these, or with some help from the general fund.
The big question is what happens to all the other obligations of BofA. Will these get paid by the government as BofA gets unwound? If so, then having FDIC insured deposits is meaningless, as they will have to tax you in order to get the money to pay off the derivatives, or print money and pay the derivative payoffs with inflated money, making the value of the guaranteed deposits worthless through inflation.
They will claim that the right hand paid everything, but the left hand will be picking your pockets.
If the FDIC fails to live up to its obligations, all banks in the country will be closed shortly thereafter. You’ll see runs on all the banks healthy or not. For the FDIC not to pay would essentially be a default by the US government.
If that happens, BofA will be the least of your concerns.
Very educational...
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