Bank Runs Likely? Gallop Poll (6/2/99) for FRB, FDIC, OCC, OTSgreenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
June 2, 1999 Gallop Poll - Conducted for:
Board of governors of the Federal Reserve System Federal Deposit Insurance Corporation Office of the Comptroller of the Currency Office of Thrift Supervision
Here's a quick summary, but definitely check out the full 27-page report, which outlines the problem with graphs, etc.
More than 60 percent of Americans anticipate withdrawing extra cash from their bank accounts in preparation for possible Y2K disruptions, according to a survey sponsored by three federal agencies and the Federal Reserve Board.
The survey, conducted by the Gallup Organization, found that 26 percent of the 2,700 respondents "definitely will" get extra cash from their bank accounts; another 36 percent said they "probably will" do so. These add to 62% that are likely.
Among those respondents anticipating extra withdrawals, 6 percent will get enough extra cash for "a long weekend," 12 percent will withdraw enough for a week, and 9 percent plan to get enough to last "several weeks." Nineteen percent said they plan to get cash to last a month or longer.
Only 14 percent of the 2,700 respondents said they likely will withdraw all their money from banks; 80 percent said they have no plans to withdraw all their money.
Fifty-one percent of those polled intend to "definitely" keep better track of their bank transactions in the months ahead, to be on the lookout for possible Y2K-related errors.
-- Zach Anderson (firstname.lastname@example.org), June 22, 1999
There is definitely a large "pucker" factor among management because of this survey. You can practically hear the sphincters tighten in DC as senior management continues to look for a way to defuse this ticking bomb. So far, most of their efforts have been of the CYA variety.
-- Nabi Davidson (email@example.com), June 22, 1999.
Zach, as valuable as your post is, are we all on the same page here?
Because although what you quote is true and valid, you know how polls are, right Zach? It all depends upon the wording of the question that people are asked, plus people's intrinsic contradictions, etc.
So the way I read that same poll Zach is even worse, FAR WORSE (although consistent with what you indicate). Please read
page 14: Quote Gallup "47% (of Americans) consider it likely that people will panic and withdraw ALL their funds prior to year's end" This is half of American households here, understand?
page 16: Quote Gallup: "One respondent in five (20%) believes that the entire banking system will be forced to shut down on January 1, 2000 by computer problems". And this is only June.
See what I mean? And this is just in the US. Elsewhere in the world (because the rest of the world does exist guys, as you well know), people will ALSO demand US dollars as soon as they realize how feeble this whole situation is. And currency (cash) runs will also take place in other currencies too. And when people can't find the dollars they want, they'll cash in their local currencies for precious metals, mainly gold and silver, probably gold.
Guys, the whole wide world put together doesn't have enough minting and press facilities to print all of the cash required by people before the end of this year.
FLINTon, Poole, Decker, where are youuuuuuuuuuuuuu? Come on, earn your pay guys.
-- George (firstname.lastname@example.org), June 22, 1999.
OH great. Here comes Norman Rockwell's bank run.
-- Will continue (email@example.com), June 22, 1999.
There have been lots of posts and threads, here, on the cash problem. It all derives from the fact that we are subject to a corrupt money/credit/banking monopoly, legitimitizing fractional reserve banking and credit creation out of thin air (banks only, please), courtesy of your U.S. government. The fact that it is no better anywhere else just means that all governments are corrupt -- even this so-called bastion of free enterprise and moral superiority.
If you look up the other threads, you will see that actual cash (Federal Reserve Notes [not legally notes] and coins [actually tokens]) ranges from maybe 1% to 2% (depending on how you count) of actual demand deposits (checking accounts, etc.) That means that only 1 or 2% of the people can get all their money out, or everyone will be able to get only 1 or 2% of their money out in cash. The money panic will start, and it will start, when a "trigger point" is reached this autumn, where a critical number of people realize that "emperor has no cash."
-- A (A@AisA.com), June 22, 1999.
A - which trigger point might that be?
-- justme (firstname.lastname@example.org), June 22, 1999.
Justme, literally anything.
It could be GPS roll-over Aug. 21-22, it could be 9-9-99, or the Japanese cashing in their 3oo billion worth of US T-Bills... or it could just be the cumulative summation (I just know that FLINTon will love this) of y2k defects piling up on each other, accumulation of the different Jo Anne effects, the testing attempts and consequent mis-firings (like 4 million gallons of sh*t in Van Nuys), or whatever... Does it really matter ?
-- George (email@example.com ar), June 22, 1999.
"Only 14 percent of the 2,700 respondents said they likely will withdraw all their money from banks..." That is TEN times the amount needed to break the banks. But, what the hell - I've already taken most of mine out.
-- Dan G (firstname.lastname@example.org), June 22, 1999.
I am a 14%'er. Just cashed out my bonds today. Got rolled coin, small bills. Now, I just need to stuff that matress...hmmmm. I do have a special plan for taking care of the cash so it is unavailable to others, but of course Y2K holds no guarantees no matter what you do. Just being prudent prior to the stampede.
-- Sammie Davis (email@example.com), June 22, 1999.
While I don't plan to take ALL my money out of the bank, I do intend to pay bills early and leave only the minimum balance plus any leftovers (usually $1.47) in the account for rollover. Yet, while keeping my account active, it is virtually the same as taking all my money out. I wonder how many respondents have plans similar to mine. If many, it would make survey results more encouraging than they should be. (And as they stand, they do spell financial ruin to a LOT of banks...)
-- Mad Monk (firstname.lastname@example.org), June 23, 1999.
I'm a bit weak on financial issues, but couldn't our wonderful fearless leaders print $1,000 bills, or have some other form of interim "currency" (assume the power-grid survives)?
Isn't the real threat the incredibly low net "reserve" held by banks (and the related "debt bomb")? I have heard figures suggesting that banks have less than 2% in reserve, since there are so many "loop- holes" in the 10% reserve requirement.
-- Anonymous99 (Anonymous99@Anonymous99.xxx), June 23, 1999.
Sure. why not print up $10,000 bills while they're at it - instead of toying around making Lincoln's pic bigger(?) And no, flooding mountains of extra cash in would not trigger inflation - cash received by banks would be subtracted from their ledgers.
By the way, how are the new bills supposed to thwart counterfeiting when the old ones are not to be recalled? If I were a counterfeiter, I'd keep on printing the old $100s. And, as a counterfeiter, I would actually be a boon to the economy, as I would be adding cash into the system without any debt attached, thereby enabing more debtors to repay the overall debt owed to the Fed. See? It's confusing! Of course, we frown on counterfeiters because nobody deserves a free lunch, but which is worse? The Fed not only gets a free lunch, but we actually pay to watch them eat it!
Notwithstanding, I don't think the solution is to become Fed bashers. But yes, the truth is there is very little cash available to "oil the machine". Gold? Well, in case you haven't been following the scene for the last 30 years or so, the vast majority of our [USA] former pride, the Fort Knox gold reserve, has been quietly removed and now sits in vaults beneath the streets of Basil, Switzerland. So, is the Fed really to blame?
-- Zach Anderson (email@example.com), June 23, 1999.
Just me: What will be the trigger? When and where on your bathroom mirror does some of the mist turn into a droplet trickling down? You don't know exactly when or where, but you know it will happen.
Feel free to copy and distribute widely the following:
Y2K and Your Money
Later this year, the BANKING system is going to go BELLY UP.
Why? Simply because there is not enough CASH in existence to cover the additional demand for actual cash by people wanting to build up a cash stash in preparation for Y2K problems.
How? Because years ago big government in cahoots with big banking created a fraudulent money/credit/banking system. Banks create money out of thin air (but, naturally, it's illegal for YOU to do it) far in excess of actual cash in existence. Most of the "money" is just bits in computer files. This is the "magic" of fractional reserve banking.
Basically, there is only enough cash in the "system" to cover 1% to 2% of the amounts in -- basically -- all the checking and savings accounts. This means that if you and everyone else at the same time wants cash instead of electronic numbers, there's only enough cash to give you 1% to 2% of YOUR MONEY in cash. Or, only enough cash to give just 1% to 2% of everyone all their money in cash. If you are number 3 in a line of 100 people, you will be S.O.L.
Bottom line -- get some extra cash out of the bank NOW. By Labor Day it may be too late.
Y2K (Year 2000):
S.O.L. == Sh*t out of luck
-- A (A@AisA.com), June 23, 1999.