Just read this article – http://finance.yahoo.com/tech-ticker/article/56994/Top-Economist-Americans-Should-Worry-About-Bank-Deposits-if-Congress-Doesn’t-Act?tickers=LEH,MER,BAC,AIG,WM,%5EDJI,%5EGSPC . I keep hearing that the money in banks is insured upto 100,000$. But as the article mentions, how can the FDIC insure $1 trillion in assets when it has only about $50 billion ?
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WaMu (Washington Mutual) has deposits around ~150 B and looks like it is going to go under prety soon…and how will FDIC with 50 B pay the depositors ????
I think 80% of WAMU deposits are FDIC insured. And it will get paid by You,ME and US- ( FED. Tax)
Prior comment was from me-
As many of us knows that up to 100k of Deposits are insured by FDIC. But if your deposits has POD (Payable on Deaths) account then it can be insured up to 400k (For family of Four). Here is the link for more details- http://www.fdic.gov/deposit/deposits/insuringdeposits/#joint
If the fed lowers the interest rate anymore, I find no incentive of keeping my money in the bank considering the measly interest rate they pay now. Maybe I will be better off keeping it all under my pillow :-). I would think that if the banks want to increase the deposit amounts, they would want to entice customers with higher interest rates, no ?
Just came across this article in BusinessWeek – Why American Savers Have Drawn the Short Straw
Very appropriate article Leena. The savers get the “low”interest rates + taxes on the proceeds. Govt says inflation is under control while excluding items like gas, food, healthcare and what not out of the equation. This way they can pay less interest on Treasury bonds too…..I think its a big game played by the govt…maybe a scandal…
The term “FDIC Insured” just got 100 times more important. :-). Now at least everyone knows what is FDIC insured and the limits :-). Earlier it was just all “Theory” but now its “Practicals” and hence will stay in memory more easily. 😉
Someone should Audit FED Balance Sheet- FED is giving 85B to AIG- What’s Next?
Mr. Bernanke, I have lost a significant amount of money in this stock market turmoil. You bailed out those greedy speculators who bet on housing with zero down. You are also bailing out all these institutions who made bad bets on the speculative housing boom. I, on the other hand, have been diligent and did not make these bad bets, except for the stock market. Can you bail me out as well ?
One thing to understand is “if you are tooo big tooo fail, the Fed will bail you”, even if you made bad bets, spent all the world’s money….Now that FED is bailing out Fannie, Freedie, AIG, Bear Sterns…who will bail out the FED????
The sovreign funds of China, Abu-Dhabi, Japan and rest of the world will bail out the Fed as “the FED is just tooo big toooo fail”…..Foolish, insignificant savers like you and me, who did not take debts and make bad bets cannot be helped…..
This is just outrageous …. Got the email below in our mailing list basically asking for advise as to how to walk away from debt … Also this article brings to light tactics people are using to just walk away from their debts. Sad, just sad.
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I bought my home with 3% down for 585K in Fremont,CA in 2005.
With the housing market going down, the house is now valued at 403K in zillow and a real estate agent appraised it for 440K.
Looking at this data, I am looking for ways to get away from this loan and house as soon as possible, which will save me a huge amount in interest that I am currently paying (loan amount 537K).
1. Is short sale the best option, even though I might not be able to prove any hardship.
2. Can I still save my assets in banks, such as CD’s, savings a/c, 401K etc., 3. Can I transfer the loan/title to my spouse, or viceversa. The house and loan is in both of our names now.
4. How long do I have to wait before I can buy another house, considering the house values are going very low.
5. Does this affect GC process or citizenship if any.
6. Any other better options.
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I know of another such case firsthand where a person bought a 800K+ house, couldnt afford the payments, so walked away from it. But before he walked away, he went and bought a convertible and a condo for about 300K. Basically he bought everything that he may need before his credit rating went bad.
Considering these practices are still continuing , I dont think we have seen the bottom yet. Someone will have to pay for all this and guess who it will be.
Bad bet made by individuals in Stock Market cannot be “bailed” out. You should need at least > 50 Billion in $$$ to be “bailable” else you are on your own 🙂 🙂 🙂 If you have lost more than 50 billion and need to be “bailed” out – please call the Feds at 302-456-0987
This feels like a game of Survivor where every week one person is voted off. We have taught Kairavi to say “Bye Bye Person X” whenever the person voted out is revealed at the end.
Looks like its time to apply the same to banks. I will tell Kairavi to say “Bye Bye Wachovia” in the evening.
Well the names of the firms deeply entrenched in subprime mortagages have been out there. It’s not the matter of who but when and how. Just like the hindi movies. the villain is going to bite the dust in the end however, what gimmicks the director will use for the hero to beat up the villain and what lousy dialogues will be exchanged during the last fight.. just the anticipation of that is exciting.