Monday, April 14, 2008

such negativity...

I have alluded to fractional reserve banking in the past, and David sent me an e-mail a while ago wondering about it. I don't have a lot of time these days to delve into it (or much of anything beyond me super cool kid), but I have understood that it was at most 5% (in Canada), and maybe as low as...gulp...0%. Makes you feel good about paying interest, eh?

But I stumbled upon this article that had in its first paragraph -

"The banks have no reserves other than debt."

Negative reserves? We are really fecked. What if I want to pull my million bucks (I wish) out of the bank in Loons? Is the bank going to tell me that they have no money - let alone my money?

It's a short article to read, with references to the New World Order and the Amero in the comments. Here is a snippet -
The reserves have collapsed - the banking system itself is bankrupt. Credit crunch is a very nice way of saying this, credit crisis is starting to sound a little more accurate.

Ah, but the Federal Reserve has saved us from a bank run! Well, they've put up $140 billion (plus whatever they're adding this week) so the economy could have $20 billion in loans - this is an amazingly ineffective & convoluted means of generating financial activity.

The reserves backing your checking or savings account are all owed to the Federal Reserve and the banks don't have the capital necessary to generate enough profit to ever reasonably pay this debt back.

It's a very twisted illusion that we live in.


Monkey Money said...

I'm not surprised. I tried to withdraw $9700.00 cash from Vancouver Main Branch of BMO last week and was refused. Apparently you have to give them one day's notice to withdraw such a "large" sum. The bogus reason: "er...the bank has to make sure it has a certain amount of cash on hand at all times." Teller told me I can only withdraw $5000 cash a day unless I give them advance warning. This is the Vancouver Main Branch of BMO, not the Fisherman's Credit Union! Christ!

Anonymous said...

there were no bank failures in canada during the great depression and that's when banks issued their own money.

as for the us fed i think fubar is the right term


patriotz said...

Well none of the majors failed, I'm not sure about the smaller banks.

In any case our very own Bank of BC failed in the early 80's (it was taken over by HSBC), plus two Alberta-based banks (liquidated).

jesse said...

"Teller told me I can only withdraw $5000 cash a day unless I give them advance warning."

I'm not putting my tinfoil hat on for this one. With all the bank robberies I'm not surprised they want minimal cash on hand. If you want some large amount in "cash" get a cashier's cheque or money order.

cabinman said...

This is a global credit crisis the world has just begun to resolve. Each time you will be told that the credit problems have been contained only to find conditions worsen.

Look at the way the above chart plunges sighting what is really going on in the worlds' financial system. The credit erosion cannot be contained because as the economic conditions deteriorate so does the credit crisis deepen.

In the end game all the governments have succeeded in doing is stalling the inevitable banking and financial collapse. The chart simply shows us graphically what we already could sense when we witness
the 85 yr old Bear Sterns collapse in 48 hours.

The rot in the financial system is on par with 1930 we will see what comes.

Anonymous said...

This is a global credit crisis the world has just begun to resolve.

Resolve? Ah, a little pre-mature on the 'resolve' thing, aren't you?

If anyone was going to "resolve" things - it would have happened back in the Great Depression. Evidently, that didn't happen, and here we are again.

The banks invent mischievious games - and people buy into them.