HeadLie: Withdrawing Your Money From Banks Will
Make the Recession Worse
by Mac Slavo: Gun
Sales Surge on Black Friday: Over 129,000 Background Checks Flooded
In case you
haven't yet heard, the Greeks
are quietly continuing with a run on their banking system, a
situation we've reported on previously, and one that British EU
Farage warned of just a few short months ago. Savings and time
deposits have dropped 30% since the start of the year and almost
10% was withdrawn in just September and October. It's not panic
in the streets – not yet, at least – but it's getting close.
Greeks are draining their savings accounts because they are out
of work, face rising taxes or are afraid the country will be forced
to leave the euro zone. By withdrawing money, they are
forcing banks to scale back their lending – and are inadvertently
making the recession even worse.
description for the Der Spiegel article suggests that it is the
fault of the Greek people that the country's recession – more appropriately,
depression – continues to worsen.
Spiegel, essentially the German versions of the New York
Times, suggesting that amid all of the chaos with Greek government
bonds which are without a doubt in free fall, and the threat of
a destabilizing (and potentially destroyed) Euro, account holders
should put their trust in the very system that brought about this
may argue that the behavior of Greek account holders is irrational
and contributes to the problem, we'd suggest it is the most rational
move a person can make, especially if you recently heard Federal
Reserve Chairman Ben Bernanke's testimony before Congress in which
he specifically noted the substantial
risk to our economic and financial systems stemming from, among
other things, a run on the banks in Europe.
style bank runs are not just some outlier that exist only as theoretical,
low probability events. In fact, it is becoming apparent to many
that this is exactly what is playing out now in Europe, as governments
are reportedly requesting Contingency
Planning for Extreme Scenarios Including Rioting and Social Unrest.
The very problems
coming to a head in Europe in recent weeks and months are also embedded
within our own financial system. After the crisis goes full-panic
in Europe, we won't be far behind. And you can be assured that our
media, like Der Spiegel in Europe, will be touting the
many benefits of keeping your money in your bank account – and using
guilt-based motivation purporting that those who withdraw funds
are hurting the economy. All the while there will be scheming behind
closed doors to restrict capital flows and likely bank holidays
during which we may very well see devaluations of the US dollar.
One day you may wake up and learn that the $1,000 you had in the
bank is now only worth $100 in purchasing power.
Hard to believe
that it can happen in America? Yes. Impossible? Elliot
Wave Theorist weighs in:
was serious in 2002 and enormous in 2006. Now it has become acute,
because many loans are becoming fossilized, as the market for
mortgage investing has dried up while foreclosures on the 'collateral'
have been slowed by court actions and politics.
of a banking panic has become far darker since the collateral
for bank deposits – land and buildings – has fallen
globally in value at the steepest rate since the Great Depression.
One day this shortfall in collateral value will impress
itself on people's minds, and there will be an unprecedented run
on banks around the globe.... Yes, I know about the FDIC, but
I don't believe it will be able to fulfill its promises when most
banks go bust.
If you want
to leave all of your money entrusted with the very same people who
have stolen billions in tax payers' dollars to pay off their fraudulent
too-big-to-prosecute schemes, be our guest. If you believe that
the FDIC will have enough funds to bail out individual Americans,
then we suggest you go ahead and have another glass of Kool Aid.
But, be aware
that unless you act before the rest of the crowd, you may very well
end up at your bank one morning to a sight similar to the following.
customers wait to get their funds all over IndyMac banks in California
after regulators took control in July of 2008:
all over the UK headed straight for Northern Rock Bank once they
learned it was no longer solvent in 2007:
at New York's American Union Bank during a bank run early in the
Great Depression (June 1931)
from SHTF Plan.
Slavo [send him mail] is a
small business owner and independent investor.
© 2011 Mac Slavo
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