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post #10 of (permalink) Old 10-11-2018, 08:01 AM Thread Starter
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Join Date: Oct 2009
Location: far east north corner of Texas
Posts: 6,647
Originally Posted by Redneckgearhead View Post
So wait, you think the banks going to confiscate your money?

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After the bail out by the Fed, regulations got passed to allow for "bail in's" because the Federal Reserve doesn't have another bail out in them at this point. Actually, they most likely do but they do not want to be responsible so they lobbied the world governments(G20) to pass the bail in scheme and they did. Now saving TBTF banks has been passed on to US.

Under a bail in, something happens similar to what happened on Cyprus. The regulations are part of the Dodd-Frank Act in the U.S. It allows the banks to use bank share holders investments as well as depositors and regular banking customers accounts to bail-in the banking institutions if they are about to fail. Pension funds are also considered to be bail in assets now. Derivatives which are again the most likely cause of banks eminent failure are protected. There is presently close to 300 trillion in derivatives outstanding.

Deposits are considered to be unsecured liabilities. The banks have been now defined to be the owners of your deposits. You are considered to be a creditor. In a declared bail-in situation, FDIC protection doesn't work because the FDIC and its responsibilities in a bail in have been re-written to facilitate the bail ins. I believe that the failing bank is supposed to issue you contingent capital bonds(bail in bonds) for confiscating your money but the likelihood of ever cashing those in later and breaking even is very low.

The thing is full of financial mumbo jumbo but this is what I think I have been able to understand and grasp from reading it all. Gave me a head ache.

65 2+2, 331, C4 presently apart for complete a restore
1979 Ford F150 custom, 302, C4, AC, tilt wheel, main transportation

Last edited by macstang; 10-11-2018 at 08:04 AM.
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