26
Jul
08

Safe To Bank?

Think the economy is in the crapper? Maybe, maybe not. Down markets generally present interesting, albeit risky, investment opportunities. What about your cash? No, I’m not talking about the spare change stuck in the sofa or the couple of Benjamins you stash in your underwear drawer. I’m talking about the money you keep on deposit at THE BANK. THE BANK… as in that financial institution that you count on to be as safe as our food supply. US regulators have closed the sixth and seventh banks to go belly up this year. “All depositors, including those with deposits in excess of the FDIC’s insurance limits, will automatically become depositors of Mutual of Omaha Bank for the full amount of their deposits,” the FDIC said. That’s comforting. They are letting you know that they really don’t have to insure you above the limit, but are granting you a boon. Banks closed this year:

  • First National Bank of Nevada
  • First Heritage Bank
  • IndyMac Bancorp
  • First Integrity Bank
  • ANB Financial
  • Hume Bank
  • Douglass National Bank

Lenders on the FDIC’s “problem list” grew to 90 in the first quarter from 76 in the fourth quarter of 2007, the FDIC said in May. The FDIC insures deposits at 8,494 institutions with $13.4 trillion in assets. I would not suggest investing in Zimbabwe’s currency as a hedge strategy. Right now, their 100 BILLION dollar note might buy you a loaf of bread, if they can get the things printed.

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1 Response to “Safe To Bank?”


  1. July 26, 2008 at 9:37 pm

    In a sign that some words are losing/changing their meaning, I’d never put any money in a bank that had “integrity” in its name.


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