www.gold-eagle.com: not enough people have enough savings to cause U.S. bank runs?

greenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread

Interesting editorial appears today at www.gold-eagle.com. The writer fully believes that the financial bubble is going to burst, and that Y2K may very well cause it. However, he does not see pre-Y2K bank runs being a factor, because in our negative savings, paycheck-to-paycheck environment, there just aren't enough people that are a threat to the banking system.

The writer also describes an interesting personal experience with his bank, Wachovia. I thought this was one of the "poster child" banks for Y2K compliance, that they were one of the few that achieved it. (Not?)


-- Jack (jsprat@eld.net), June 30, 1999


The guy is wrong. There are more than enough people who may want to convert at least a portion of their stock portfolios to actual cash, to cause a problem. And, yes, by year-end there will be an average of $2500 per person in existing currency. The problem is that most of that circulates in foreign countries today.

-- Dog Gone (layinglow@rollover.now), June 30, 1999.

Thanks, I read that, but I now wonder--will the postal service be able to deliver those consumer letters? Will I get my NYC mail in Florida so I can check my charges and balances? Twilight Zone music is playing in the background. I think I'll switch to Amazing Grace.

-- Mara Wayne (MaraWAyne@aol.com), June 30, 1999.


Thanks for the post. Especially since I bank with Walk-all-ova-ya. Oops, I meant Wachovia.

-- (tw_44@yahoo.com), June 30, 1999.

Take a count of the retired folks. Then take the total of their liquid assets, - CD, Money Market, Savings, Stocks, Bonds, etc. Now look at their savings rate. It may well be negative. Yet the retired folks alone, in my opinion, could drain the system of cash.

Went to my bank the other day and looked at the stone that had the date of construction on it. In small print, in the lower left corner, it said, "Expires 12/31/99".

-- Daryl (rushmore@dailypost.com), June 30, 1999.

People may not have savings, but they still have plastic. If their credit cards are already not maxed out, they will try to get cash -- on credit -- through the ATMs or cash advances at the bankes.

Also, the Treasury may NOT be able to just print more cash (bills) at a faster rate than at present. Their presses are already running pretty much at capacity. And the new funny money has to be processed to embed the mag strips. And the paper has to be a high quality watermarked paper. If they tried to keep up by printing conventionally on cheaper paper, all their "anti-counterfeiting" measures would not be present, opening up some additional private entrepreneurial opportunities.

-- A (A@AisA.com), June 30, 1999.

I did notice the author mentioned a rise in the interest rates to keep things going in a desperate attempt at making sure the bubble doesn't burst:

And here it is, he couldn't have called it better with a telephone;

Feds plan to raise interest rate

-- (AtlantaAS@aol.com), June 30, 1999.

The average poor sap may not be enough (I think it is), but the people who are most concerened about their moola, are usually the ones with the most moola. In this day and age though it's all tied up in investments(not liquid).

It won't take joe/jane 6 pack to cause the burst. It will only take the upper crust group of joe millionaire 6 pack's. Everything hinges on THEM.

Polly's, go get 'em, for they are the closet DOOMERS!!

If we're all draining the "pool", with 12oz cups, and the "big wigs", are using 50 gallon drums, who's fault will it be when the pool is mt?

-- CygnusXI (luppotreb@aol.com), June 30, 1999.

Cygnus XI? Are you a 'Black Russian'? (inside joke - ignore it)

Sounds like what I posted last week - and I really doubt most of the rich will try to pull their money into cash. Bonds and T-bills I could believe, possibly real estate in a few cases. But never cash. A million bucks in cash would be like sitting on a keg of dynamite.

-- Paul Davis (davisp1953@yahoo.com), June 30, 1999.

Dynamite is fine if you know how to handle it. I know of several folks who have over a million dollars in cash and metals stashed away. People who have that kind of money just buy better safes and install them in secret places. No big deal.

-- Prometheus (fire@for.man), June 30, 1999.


"A million bucks in cash would be like sitting on a keg of dynamite"

Put me down for 3 keg's please. Actually a keg of beer wouldn't be too bad either 8^o Peace

-- CygnusXI (luppotreb@aol.com), June 30, 1999.


"But never cash." And certainly never gold. And certainly not real estate either. Or a spare house in another country, with second passports ready to go. No, never.

Diversification, dear man. The first rule of wealth.

A million is pocket change for more now than ever before. They'll just have the banks' armored SUV's stop by their house for a first delivery, before we can get our little cups held out for our drops of green stuff.

Also, Paul, most bank runs in recent decades have been started by:

A. Depositors?

B. Borrowers?

C. Other banks?

Correct answer? Of course, C.

This time A, B, and C.

But keep your finger in the dike, yeah, right THERE, Paul. Good, now I gotta go get something at the ban- er, store. See ya.

-- tee hee (fort_knox@james.bond), June 30, 1999.

Dike, shmike, all it would take would be one chatty teller and you would have more 'midnight guests' than an army could drive off. Not to mention just how you are going to acquire that kind of cash without a lot of questions being asked by DEA, IRS, FDIC and bank presidents. Remember the reporting rules? Don't EVEN think I supported that stuff - but it is law, and sure would make me think twice if I had that kind of jack.

And Cygnus - I guess you missed my joke - Cygnus X-1 is a black hole. In Russian a black hole is something not mentionable in polite society - so they prefer to call them 'frozen stars'. Never mind.

-- Paul Davis (davisp1953@yahoo.com), June 30, 1999.

Paul Davis, your recent posts indicate that you are in need of a "meme change" or something. Better not look through your telescope so much, especially avoid that bright shiny star that you can see real well in the daytime. Maybe it put a hole in your brain.

If somebody decides to withdraw THEIR money out of THEIR bank account that is THEIR right. The DEA does not get involved. It is the bank's responsibility to file a CTR, cash transaction report, if the amount is $10K or over. There is also an IRS form that they may want to fill out, too. So what? Who cares?

"What governments cannot find they cannot steal."

-- King of Spain (madrid@aol.com), June 30, 1999.

Young naieve Paul is under the impression that HIS money belongs to the IRS, DEA, FED, GUBBMINT etc. etc.

Young Paul does not it seems know about the 10k rule - the buffoon thinks that if you draw out more than that in cash it will be confiscated by the alphabet agencies above...

Actually he's not far wrong :)

-- Andy (2000EOD@prodigy.net), July 01, 1999.


I seeee. BTW I took my "name" from a Rush(the group, not the fat hypocrite guy)song by the same name(which is about a black hole). AN exerpt from the song.." Spinning, whirling, still descending, like a spirial sea unending. Sound and fury drown my heart, every nerve is-- TOOOORRRN APAAAAARRRT.".

Sounds like y2k/or not.

-- CygnusXI (luppotreb@aol.com), July 01, 1999.

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