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Old 12-27-2012, 01:01 AM   #13
Krystal Locke
Location: Phoenix, Oregon
Join Date: Jun 2004
Posts: 385
United_States
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Re: Financial self-protection

Quote:
Rupert Atkinson wrote: View Post
Well - I see how you think Matthew - very practical. Personally, I think silver is better than gold. And in New Zealand a fishing rod and dingy will probably be better than a gun. It's a fairly safe place to be and I shall be back there after this latest stint in cold Nippon.

Reading up on what is going on - if the banks start to fail (51 small ones have failed in the USA in 2012 thus far) enmasse, the cash in your bank will either not exist, or will become unavailable even though they say it is guranteed since the banks will close - then when they reopen they may limit your withdrawals. This is not insignificant waffle - it has been playing out in Greece, Spain, elsewhere (but is kept out of the mainstream news).
Rupert, check this site out.

http://www.fdic.gov/bank/individual/.../banklist.html

Far more US banks failed in 2011, 2010, 2009, and 2008. The vast majority of the failed banks are small, fairly recent startups that did not have the ability to meet their obligations. Small banks tend to attract small money and customers who are not particularly money-wise and flinch when they hear a scary news story. Small banks also felt a lot of pressure (both from larger banks to be competitive in loans, and from customers who requested unwise loans) to overextend themselves when the credit and housing bubble was forming.

The company holding my IRA was deemed too big to fail, and so I lost far less than folks with retirement accounts with small institutions, and I very purposefully chose my bank on the same criteria. I dont think Bank of America is at all overextended in the way The First Hometown Bank of East Neighborhood Smalltown Heights is going to be when just one of its 137 customers defaults on his mortgage or small business credit account. And the local branch tellers still know my name, ask after the cats and the home improvements, and call me up if it looks like I'm going to be a little short one month. Almost 25 years with the bank, same free accounts, and not one incident of poor customer service.
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