From: [email protected] 
[mailto:[email protected]] On Behalf Of Jack Bauer
Sent: Tuesday, January 19, 2010 2:31 AM
Subject: EconomicWar> Here it comes!!! Couldn't happen to a more deserving 
bunch!!! 200 More Bank Failures Expected in 2010!!!!!

 


200 MORE Bank Failures Expected in 2010 
By  
<http://www.gliq.com/cgi-bin/[email protected]>
 Martin D. Weiss, Ph.D. 


Image removed by sender. Martin D. Weiss, Ph.D.

 

Washington has so thoroughly botched its supervision of the banking industry 
that 200 banks are likely to fail this year — easily surpassing last year's 140 
bank failures ... Inevitably involving the greatest bank losses in history ... 
And already costing the FDIC ten times more than the great S&L and banking 
crisis of the 1980s did.

I am not basing these conclusions on conjecture. They come straight from 
official sources. Specifically ...

In her  
<http://www.gliq.com/cgi-bin/[email protected]>
 testimony before the Financial Crisis Inquiry Commission on Thursday, FDIC 
Chairman Blair attacked the Fed under Greenspan for causing the housing bubble 
and subsequent debt crisis with its highly stimulative, low interest rate 
policy of the 2000s. 

She slammed virtually all of Washington for allowing banks to establish a huge, 
high-risk "shadow banking system." 

And she made it abundantly clear that, without sweeping, far-reaching reforms, 
we risk another devastating debt crisis. 

Each of her conclusions is abundantly obvious and thoroughly documented. What 
she did not mention, however, are the following equally obvious facts: 

Obvious fact #1. The Fed under Bernanke is now pursuing an even more 
stimulative, lower interest rate policy than it did under Greenspan, 
threatening to create even larger bubbles and more devastating busts ... 

Obvious fact #2. In just the last two years, between bank bailouts and easy 
money, Washington has done more to encourage the growth of the shadow banking 
system than in all previous years combined, and ...

Obvious fact #3. Despite all the talk and testimony, the nation's powerful 
banking lobby virtually guarantees that, in the absence of another Wall Street 
meltdown, the chance of sweeping reforms is virtually nil. 

So here's America's financial dilemma in a nutshell: 

Without sweeping reforms, the nation is doomed to repeat history with another 
debt disaster. But without another debt disaster, the nation's political will 
for sweeping reforms is dead or dying.

In the meantime, the aftershocks of the 2008 debt crisis are getting worse, as 
the latest news clearly illustrates ...

171 actual total failures: In addition to the 140 banks and S&Ls that failed in 
2009, 31 credit unions went under, bringing the total tally to 171.

Worse than the 1980s: If you're among those who think today’s banking crisis 
isn't nearly as bad as the great S&L and banking crisis of the 1980s, think 
again. The average bank failing today is six times larger than it was back 
then, producing far greater losses. Moreover, each bank failure is costing the 
FDIC about TEN times more than it did in the 1980s crisis, according to the 
Meridian Group of Seattle. As a result ...

Worst FDIC losses of all time: The FDIC lost more money in bank failures ($36 
billion) than it lost in the ENTIRE five-year banking crisis from 1987 through 
1992 ($29.6 billion). And in 2010, with the number of failures likely to 
increase, the losses will be even larger. 

Big banks still losing billions with consumers: Until last week, the consensus 
opinion on Wall Street was that the troubles at the BIG banks were over; that 
to close this chapter in history, the only task remaining was a mop-up 
operation at smaller regional and community banks around the country. 

That theory was shattered on Friday when JPMorgan Chase revealed it was forced 
to add $1.5 billion to its consumer loan loss reserves. The big problem: When 
it took over Washington Mutual last year, the biggest failed S&L of all time, 
it inherited a cesspool of mortgages that are now going bad at an accelerating 
pace. Other big consumer banks — like Citigroup and Bank of America — likely 
face similar woes. 

The trading profits of big investment banks are a bubble: What most Wall Street 
bank analysts still don't seem to recognize is that the giant trading profits 
they've been so enthusiastic about are generated by the same low-interest Fed 
policy that created the housing bubble — and is now in the process of creating 
MORE bubbles. 

Without the Fed's largesse, without the low-cost financing, and without the big 
risk appetite it generates, most of the big bank trading profits would have 
been impossible. More to the point: Just as soon as the Fed finally executes an 
exit plan, the bulk of those profits are likely to turn to losses. 

What To Do

First and foremost, do not let up your guard when it comes to keeping your 
money safe. Yes, I know. With all the talk of the "end" to the crisis and 
Treasury bills paying virtually nothing, it's tempting to venture away from 
safe harbors. 

But how much more yield can you get by doing so? If you switch from Treasury 
bills to bank CDs, for example, the most you can gain is a small fraction of a 
percent. And if you switch from bank CDs to low-rated corporate debt, the extra 
yield you get is even less attractive. 

In sum ...

At this early stage so soon after the worst debt crisis since the Great 
Depression, the TRUE RISK of putting your money in higher yielding savings 
vehicles is still very high. Nevertheless, banks and other borrowers are asking 
you to take that risk WITHOUT paying you more than pennies for it.

My recommendation: Tell them to go fly a kite!

For your keep-safe funds, use strictly short-term Treasuries or equivalent.

Second, if you do other business with a bank or if you still want to keep some 
part of your savings in bank CDs ... at least be sure to avoid the banks most 
likely to fail and stick with the ones most likely to survive. (For the latest 
Weiss Lists of the weakest banks and S&Ls,  
<http://www.moneyandmarkets.com/files/documents/Strongest-and-Weakest-Banks-and-Thrifts.pdf>
 click here. For the strongest,  
<http://www.moneyandmarkets.com/files/documents/Strongest-and-Weakest-Banks-and-Thrifts.pdf>
 click here.)

Third, bear in mind that, when it comes to your investment decision-making, 
TIMING is everything. 

Last year, the stepped-up pace of bank failures did not derail the 
weak-but-continuing recovery in the U.S. economy. And for now, that's bound to 
remain the case. As soon as we see signs that's about to change, we'll do our 
best to alert you. Until then, we stick with our current posture: Continue to 
invest, but do so with great caution. 

 

PLEASE join me!!!! You DO Have the 

Right to Flip Off a Cop!!!




Remember this statement: When injustice becomes law, rebellion 
Becomes duty! 

Support my show, and Beat The Court by going to: 
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Hurry, though, The govmnt is shutting down sites like this every day!!! 

"When the government fears the people, you have liberty. 
When the people fear the government you have Tyranny."
~Thomas Jefferson, 

Do yourself and your family a favor... 
Don't Fall into the Sheeple Pit... 

Image removed by sender.
TURN OFF YOUR TELEVISION!
Ignore the TV Media
Investigate 911

 

Disclaimer: I'm not a Lawyer, this is not legal advice. Nor am I a Brain 
Surgeon, Pastry Chef or Indian Chief. 
This communication is private and privileged intended only to those individuals 
marked "To", "CC" or "BCC". 
To the snoopy government agencies, or anyone else this mail isn't being 
specifically directed to; with all due 
Respect; cordially invited and instructed to take a hike :)

                                 Sincerely, Mike Golden aka RadioRebel

 


                        

 

 

 

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