Small and Mid-Size Banks will start failing soon.

mantic

If you have money in smaller and mid-size banks, keep a careful watch on the health of your bank. Many will begin to fail in the coming weeks.
Start looking into checking up on the health of investments. Move into precious metals. Remember the FDIC only covers up to $100k and they have 99 years to pay.
While I am at it. Start stocking up on canned foods and non-perishables. Prices are going to go through the roof end of summer.

filmlover44

Source? (here's mine: http://thefinancebuff.com/2007/02/what-happens-when-bank-goes-out-of.html )

mantic

The siht has begun to impact the fan.
Indymac is under. lehman may be next. freddy and fannie may be ass-out.
FDIC has 53 Billion in reserve. Indy holds about 30 bn in notes, the insured will eat a minimum of 10%. If those stated above go, no mo money, then it gets real funk funky.
Monday is going to be a bitch, but Tuesday is the tradition. Get ready for the ride.

People, in my eyes, it is not a matter of if the US economy tanks, it is when. Some say it is already, but the sheeple don't know it.
It is rumored via leaks, the secret meeting the House of Representatives had not long ago predicts September, with a total collapse in Feb 09. I wont go into all of what is reported, let google tell you more than the links I give.
http://groups.google.com/group/news.misc/browse_thread/thread/1b8224e6df2f0685

Also look for the recent statements by Ron Paul relating to "something big is about to happen"
http://www.dailypaul.com/node/54004

Google about the (day to late) impeachment being presented for a second time.
http://www.cnn.com/2008/POLITICS/06/11/kucinich.impeach/

Google about the President being ruled a felon in US District Court.
http://www.wallstreetsurvivor.com/CS/forums/t/14286.aspx

I don't think we're gonna have an election this year...

meredithb

Well if you're a huge bank (fannie Mae, Freddie Mac) the government will bail you out. So much for the free-market system.

daver

MeredithB wrote: Well if you're a huge bank (fannie Mae, Freddie Mac) the government will bail you out. So much for the free-market system.

Why should _this_ time be any different...?

olivo79

Lehman is in bad shape. Merrill is at a 9 year low. Citi is struggling. It's ugly out there for sure

filmlover44

It's 100k PER BANK NOT PER ACCOUNT!

(Not that I even have 100k in all of my accounts all together. Thanks kids.)

filmlover44

daver wrote: [quote=MeredithB]Well if you're a huge bank (fannie Mae, Freddie Mac) the government will bail you out. So much for the free-market system.

Why should _this_ time be any different...?

From the article that I listed above, the govt usually works things out so that the larger bank absorbs those small banks into a larger banks and you wouldn't notice much change unless you had more than 100k in that bank.

daver

filmlover44 wrote: [quote=daver][quote=MeredithB]Well if you're a huge bank (fannie Mae, Freddie Mac) the government will bail you out. So much for the free-market system.

Why should _this_ time be any different...?
From the article that I listed above, the govt usually works things out so that the larger bank absorbs those small banks into a larger banks and you wouldn't notice much change unless you had more than 100k in that bank.
Yes, an interesting article. Of course things don't always work out like that, ask McCain about Lincoln Savings & Loan in the 80s, for instance. Har-de-har.

Did you hear what Dodd (chairman of the Senate Banking Committee) had to say last night?

“I remind people of what happened over the last year and a half, that we passed legislation in 1994, requiring the Federal Reserve Bank to sit and monitor against deceptive and fraudulent practices when it came to the residential mortgage market,” he said.

“That did nothing; didn’t even propose a single regulation in that area,” he added. “So weak regulation, cops not on the beat … and you had brokers marketing products that were called ‘liar’s loans,’ deceptively drawing people into mortgages they could never afford. That’s the reason you’ve had the problems.”

Dodd also warned the television talk show’s host that to suggest Fannie Mae and Freddie Mac were “in major trouble is not accurate.”

“And even asking hypothetical questions creates it own conclusions,” he added.

Dodd defends Fannie Mae/Freddie Mac, rips Bush and the Fed

filmlover44

pffft. Boy am I glad that my kids spent all of my money.

meredithb

It'd be nice if the government bailed out some small businesses as well.

mantic

Banking regulators closed the Scottsdale-based company late today. That made First National Bank the sixth bank failure of 2008 and the first involving an Arizona institution since 2002 — and just the second Arizona failure in the past 16 years. First National was the victim of problem loans and the lingering real estate slump.

http://www.azcentral.com/business/articles/2008/07/25/20080725biz-FNBA-ON.html

daver

mantic wrote:

Banking regulators closed the Scottsdale-based company late today. That made First National Bank the sixth bank failure of 2008 and the first involving an Arizona institution since 2002 — and just the second Arizona failure in the past 16 years. First National was the victim of problem loans and the lingering real estate slump.

http://www.azcentral.com/business/articles/2008/07/25/20080725biz-FNBA-ON.html

Not pretty, but then again, does it really count as a _failure_ when 100% of deposits (insured and uninsured) are covered and the folks that bank there can continue to use their cards and checks without issue?

mantic

daver wrote:
Not pretty, but then again, does it really count as a _failure_ when 100% of deposits (insured and uninsured) are covered and the folks that bank there can continue to use their cards and checks without issue?

Had to be taken over = fail

The depositors are lucky and caught a bank to absorb them (well, "lucky" is not the right word, but appropriate).
There will be more, not so "lucky".

In other related new about the impending 'disaster'

from todays NY Post http://www.nypost.com/seven/07282008/news/regionalnews/that_70s_woe_in_rerun_121880.htm

The governor's address - which his aides hope will be televised by public and cable news stations - will say that plunging state revenues will force painful cuts in state services, necessitate a reduction in the state work force, possibly through layoffs, and require other difficult economic measures, source said.

mantic

mantic wrote: The siht has begun to impact the fan.
Indymac is under. lehman may be next. freddy and fannie may be ass-out.
FDIC has 53 Billion in reserve. Indy holds about 30 bn in notes, the insured will eat a minimum of 10%. If those stated above go, no mo money, then it gets real funk funky.
Monday is going to be a bitch, but Tuesday is the tradition. Get ready for the ride.

I hate being right. I hope the rest of what I fear doesn't come to fruition.

escap

Weighing in from the center of the storm, I fear small and mid-sized banks failing may just be the beginning. Municipals are up to their eyeballs in debt--California has announced that it only has enough cash reserves to pay for operating expenses through Oct 28. NY is no better off. Jefferson County, Alabama is defaulting in the biggest muni default in US history. And all of this is occurring as the longer-term unfunded pension liabilities continue to grow and grow. Meanwhile, universities can't make payroll because money market funds are freezing their accounts. Corporate treasurers can't arrange short-term financing and are going to have to start laying off people in waves. Non-investment grade bonds are yielding as much as 17%, and half the nation's companies are non-investment grade. Banks are hoarding cash, and the only safe haven is T-bills....

Lehman's bankruptcy sent shock waves through the system far worse than Paulson had anticipated. Imagine California. Let's hope this credit squeeze frees up soon, or we're going to have a line of states, cities, counties, banks, auto companies, airlines, you name it, all lining up to the federal trough for their handout.

The govt forced AIG's CEO to step down in return for accepting an emergency loan. I wonder if Schwarzenegger and other governors will be forced to accept the same deal...

mantic

It's only going to get worse. Last time I checked most of the south was short on gas, and has been for weeks. The shortage is creeping north. Total collapse is a few weeks away. Get ready like it's the Y2k bug all over.
The bailout bill only made things worse. Real pandemonium is coming.

escap

Err, well I certainly agree we are facing a serious crisis and it is alarming. However I'd just point out that the gas shortage has absolutely nothing to do with the credit crisis--it was created by price controls imposed in the wake of Hurricane Ike.

As for the "bailout", I don't know that it has made anything worse just yet. I see the major drawbacks as: 1) preservation of a house of cards system overly reliant on debt; 2) moral hazard among borrowers and lenders both; 3) a potential weakening of the dollar (although it has strengthened in recent weeks); and 4) potential upward pressure on government interest rates (although in the flight to safety these rates have fallen to records lows).

It certainly will not save us from recession on its own, but I will say that the mere announcement of the plan did help forestall the entire financial system falling off a cliff in the panicky days following the Lehman/Merrill/AIG failures.