Posted this for those that don't check Gary North's site.

He didn't make up this survey. If you read this and spend 20 mins thinking --- well, sorry to ruin your day.

Category: Banking Date: 1999-06-16 12:55:30 Subject: June 2 Release of March Survey of Public Opinion on Banks: 47% Expect Bank Runs. Game Nearly Over! Link: http://www.fdic.gov/banknews/fils/1999/Y2Ksurveyreport.... Comment: This Gallup poll was paid for by the U.S. government's banking regulatory agencies. I'll bet they wish they hadn't.

Let me give you the big news up front:

"With respect to public response to Y2K threats, nearly half (47 percent) consider it likely that people will panic and withdraw all their funds prior to years end, compared to 37 percent who consider it unlikely" (p. 14). (Emphasis in the original.)

This was March, 1999, before things really get rolling, before the bankers run out of compliance deadlines that are just around the corner, Real Soon Now, before TV clips show a million Japanese housewives standing in lines in front of their banks. Half the U.S. public thought that there will probably be bank runs by December: withdrawal of all of people's money -- not 72-hour weekend party money. I would call this a well-primed audience: 47 million households think their next door neighbors will go down and get 100% of their money out of the banks.

If this statistic does not produce damp shorts in the boardrooms of the New York banks, then the board members are brain-dead. But it gets worse:

"Barely one respondent in five believes that the entire banking system will be forced to shut down by computer problems" (p. 16).

I love that: "barely one respondent in five." Let that one sink in, folks. 20% of Americans say that they think the entire banking system will be shut down in January. Barely? BARELY??? If 20% of the public thinks this in March, we are going to have an interesting Christmas.

-- Jon Johnson (narnia4@usa.net), June 16, 1999

Answers

The question is: Since all of this was figured out MONTHS ago, how will it actually play out?

Can banks simply limit the amount of cash anyone is allowed to withdraw?

Why or why not?

-- curious (and@also.nervous), June 16, 1999.

This is the correct URL (PDF)

http://www.fdic.gov/banknews/fils/1999/Y2Ksurveyreport.pdf

-- me (y2k@asheville.com), June 16, 1999.

They forgot to say only 20% of Americans have any money to take out of the bank. We have had negative savings rates recently. Most live paycheck to paycheck. Look for great deals on 1 year CD's from now on. The seniors control the banks liquidity. If Grandpa cashes in all his CD's, then we have a problem. The working poor spend what they make and keep a balance of $100. in the bank. Joe and Jane Spenditall have their "money" in a 401K invested in stocks. The problem with the old controling the money is, they have wisdom and most still have fears from the Depression era. Time will tell.

-- Bill (y2khippo@yahoo.com), June 16, 1999.

Print out the entire Gallup document (.pdf) -- it's quite interesting.

At the bottom of pg. 20 they suggest, "Public information campaigns for the remainder of 1999 should be designed to aim at both sectors of society -- those who are optimistic that the potential problems will be surmounted, but are still somewhat uncertain, and those who are more fundamentally under-informed about where the banking system stands..."

So that's it in opinion of the Gallup folks. There are two types of people: those who are optimistic but somewhat uncertain, and those who are FUNDAMENTALLY UNDER-INFORMED.

They forgot one other category: Those who are fundamentally VERY informed and, as a result, are pessimistic and quite certain that the teetering Tinker-Toy of a banking system is about to be hit by a digital hurricane.

Other interesting tidbits: 62% will definitely or probably withdraw some extra cash. 14% will definitely or probably withdraw ALL deposits. This was in March -- how many in the first category will jump into the second at the first video image of a bank run on the 6 o'clock news?

(Do the math on that last one. Less than 2% of cash reserves + 14% withdrawal of all deposits = TSHTF)

It makes facinating reading, guys.

-- rick blaine (y2kazoo@hotmail.com), June 16, 1999.

"There are two types of people: those who are optimistic but somewhat uncertain, and those who are FUNDAMENTALLY UNDER-INFORMED."

THAT could not be said better.

-- (bed@wet.ters), June 16, 1999.

Yeah, right, Bedwetter. That makes a lot of sense.

3,000+ hrs of research over 18 mos. makes a person under-informed? I suppose those who get all their news from Leno, Entertainment Tonight, and People magazine are over-informed?

-- rick blaine (y2kazoo@hotmail.com), June 16, 1999.

We are the lucky few who are very well informed.

The question is - what have YOU done so far to 1. protect yourselves, and 2. take advantage of the situation.

I have taken action with my money, put my money where my mouth is so to speak. About three quarters is in the system, the rest is gold and silver. I will be taking the lot out, not yet due to legal reasons, but as soon as I get the green light it will all be out.

I'm sorry but I am simply not risking my life savings to these incompetent deecee and wall street buffoons.

To me it is immaterial whether there are bank runs before the fact because there will be the holiday of holidays at rollover. I just hope the runs don't start until my personal moola is out :) Time will tell.

<100 working days.

-- Andy (2000EOD@prodigy.net), June 16, 1999.

Yes, maybe most people do have a negative bank balance -- but there are cash withdrawals available at ATMs on many credit cards. Yee-haw!

-- A (A@AisA.com), June 16, 1999.

Long hours spent surfing web sites and exchanging scare stories with like minded people does not qualify one to claim the title "informed".

Research, in any valuable sense, on Y2K CANNOT be done on the web.

Its debatable if ANY quality research can be done on the web, (with the possible exception of researching psychological dysfunction).

Just thought that needed to be said.

BTW - Statistics, surveys, opinion, assholes, we all have em.

SHOW ME THE MONEY !

-- Lies, damn lies, (statistics@and.surveys), June 16, 1999.

"Research, in any valuable sense, on Y2K CANNOT be done on the web."

Nonsense. Suppose I find a great article in the Wall Street Journal that reviews problems the petroleum industry is having becoming compliant. Are the arguments made and evidence adduced in the article any more valid because they are printed on paper, or any less valid because I'm perusing the Web version? What about web documents from the Senate or the FDIC or the Federal Reserve or the NRC? Do such documents hold no value in research?

Your bald assertion that research, in any valuable sense, on Y2K cannot be done on the web, is either a presupposition, or a conclusion. But it is not an argument. Describing your belief is not the same as arguing for it. Tell us your reasoning behind the claim, and show us your evidence. Otherwise your post is merely a report of your personal psychology and beliefs, merely opinion, and, as you are wont to remind us, like an asshole. Everyone has one, and they all stink.

-- Prometheus (fire@for.man), June 16, 1999.

That's funny!? I try and I try but I can't seem to get the link to work. Is this perhaps because FDIC are reticent to divulge such explosive information? If I were in charge of the FDIC (Ha!) I wouldn't want our webpage to be indicating to people that there's soon going to be bank runs leading to the dissolution of the banking system awki.

And that is what this report is indicating.

And if the bank runs don't get them, then the bad loans, corrupted data, stockmarket crash and derivatives exposures will.

I don't see how serious y2k watchers can envisage anything less than a depression-with-nasty-added-extras as a best case scenario baseline.

-- number six (Iam_not_a_number@hotmail.com), June 16, 1999.

"There are two types of people: those who are optimistic but somewhat uncertain, and those who are FUNDAMENTALLY UNDER-INFORMED."

THAT could not be said better.

-- (bed@wet.ters

That statement ranks up there with the really great ones. Please excuse bedwetter for a moment. Now bedwetter, this is how you will think of the statement above. "That could not be more TELLING". Getit? OK, you can go out and play now. Sorry folks, he's all yours.

-- Mike (midwestmike_@hotmail.com), June 16, 1999.

In order to get the link to work, you have to have Adobe Acrobat installed on your computer. It's downloadable for free, but I don't have a site to refer you to.

-- Dog Gone (layinglow@rollover.now), June 16, 1999.

Andy, if everyone that has money, takes it out, then isn't it true that money won't be worth a hoot anyway? So what's the point?

-- gilda (jess@listbot.com), June 16, 1999.

Oh Gilda, you know better than that. Currency is less than 2% of total bank deposits. If bank runs disable the banking system, that other 98% becomes useless (temporarily? permanently? who knows?).

Supply and Demand. Cash will be king -- at least for the short-term. Cash will be the one medium people instinctively trust and accept.

The purchasing power of a nice, crisp 20-dollar bill will be amazing.

-- rick blaine (y2kazoo@hotmail.com), June 16, 1999.

Here's the link to Gary North's article about the FDIC document:

http://garynorth.com/y2k/detail_.cfm/5029

And the original article (in PDF):

http://www.fdic.gov/banknews/fils/1999/Y2Ksurveyreport.pdf

(even though I have Adobe acrobat, often when I download a file it doesn't launch automatically... so nothing happens. Don't know why, but finally figured out I could do a "find" - like for fdic - and then click on the file and it would open.)

The best thing about the report is the many charts. I copied them all into another file - without the text - so I could print them out and concentrate on the numbers without the spin (like "BARELY one respondent in five believes that the entire banking system will be forced to shut down by computer problems").

If you are still able to sleep at night, read the San Francisco Federal Reserve's advice to banks to plan for a worst case liquidity need (by selling off assets):

http://www.frbsf.org/fiservices/cdc.local/cash/contingency.html

Perhaps that is what is behind the Royal Bank of Canada's firesale:

http://infoseek.go.com/Content?arn=a3018reuff-19990527&qt=royal+bank&s v=IS&lk=noframes&col=NX&kt=A&ak=news1486

-- Linda (lwmb@psln.com), June 16, 1999.

rick:

If cash is king for the short-term, then what is suitable for the long-term?

The unequal distribution of cash might be supplanted with a new uniform standard: a global identification mark to buy and sell.

-- Randolph (dinosaur@williams-net.com), June 16, 1999.

Ah, Randolph, now we're getting into the book of Revelation and that's where my crystal ball gets cloudly. It wouldn't surprise me, though.

-- rick blaine (y2kazoo@hotmail.com), June 17, 1999.

number six is not just a number,

be seeing you...

-- Andy (2000EOD@prodigy.net), June 17, 1999.

wow,gallup poll,they're pretty accurate......bummer......

-- zoobie (zoobiezoob@yahoo.com), June 17, 1999.