Written by Roxanne Lewis of www.whynotgold.com
(Edited slightly by Gary Christenson)
“As through this world I’ve wandered I’ve seen lots of funny men, some will rob you with a six-gun and some with a fountain pen. As through your life you travel and as through your life you roam you won’t NEVER see an outlaw drive a family from their home.” – Woody Guthrie
The media today distracts with inane fears, the homegrown terrorist of late. You are much more likely to get hit by lightening than be affected by a terrorist attack. The real threat today, never reported, is that your life savings could be wiped out in a massive derivatives collapse. Bank bail-ins have begun in Europe and the infrastructure is in place in the U.S. as well. The poverty it will wreak will kill families quicker than any random attack by extremists. [Portugal Bail-In Jan. 2017 – It is happening.]
ALL banks are unsafe today! You are taking a tremendous risk by keeping your money in a bank as the Bank of International Settlements (BIS) is on the verge of ANOTHER debt collapse. Today the world is super saturated in debt. The McKinsey & Company’s research team estimates that since 2007 the IOUs of governments, companies, households and financial firms in 47 countries have grown to $200 trillion.
The system is bankrupt and there is no way our system can support higher interest rates. Globally interest rates are zero and even negative so if we truly have a global economy how can the U.S. support increasing interest rates? Just one small bump in the road or crisis will support dropping rates to zero or even negative rates. Their game is constant lies and confusion to defend and keep the common man invested in their system for their final act, “The Sting”. A few people, who would not turn a shovel of dirt, or contribute a pound of material, will AGAIN collect more money than all the world’s people who supply all the material and do all the work.
In November, an Italian pensioner hung himself after his entire savings, $130,000, was confiscated in a bank “rescue” scheme. He left a suicide note blaming the bank where he had been a customer for 50 years for investing in bank-issued bonds. In reality the world’s G20’s Financial Stability Board (of which the U.S. is a member) is to blame for imposing the “Orderly Resolution” of insolvent banks whereby 130,000 shareholders, investors and depositors conveniently suffered the losses in the recent bail-in.
This bank was just one of four small regional banks put under special administration over the past two years. The $3.8 billion rescue plan launched by the Italian government using the National Resolution Fund is fed by the country’s healthy banks. These funds can only be tapped after losses have been imposed on investors and depositors.
The Italian Prime Minister Renzi acted quickly by tightening the rules in E.U. on bank rescues. Losses are now only inflicted on shareholders, bond holders and depositors holding more than 100,000 Euros. His explanation reasoned that allowing four banks to fail under the new E.U. rules required sacrificing the money of one million savers in order to save the jobs of nearly 6,000 people, when in reality the 6,000 will most likely lose their jobs anyway.
The point of an “orderly resolution” is not to make depositors and creditors whole but to prevent another system-wide “disorderly resolution” of the sort that followed the collapse of Lehman Brothers in 2008. The concern is that pulling a few of the dominoes from the fragile derivative global banking system will collapse their entire scheme. The sufferings of depositors and investors are just the sacrifices you will be required to make to maintain the highly lucrative cornerstone of the elites’ banking system.
At some point a massive sacrifice will force more job losses to prop up a “systemically risky” global banking scheme. In the new movie release, “The Big Short,” Brad Pitt’s character states an estimate that, “as the unemployment rate raises 1% another 40,000 people will die from the effects,” possibly the reason “truthful” unemployment numbers are fabricated by the power structure.
When your “too big to fail” (TBTF) bank fails because they can’t pay off derivative bets they made, your government will refuse to bail them out, under a mandate titled “Adequacy of Loss-Absorbing Capacity of Global Systemically Important Banks in Resolution,” approved on Nov. 16, 2014, by the G20’s Financial Stability Board. They now will take your deposited money and turn it into shares of equity capital to keep your bank from failing.
“It is difficult to get a man to understand something, when his salary depends upon his not understanding it!” – Upton Sinclair
Once your money is deposited in the bank, it legally becomes the property of the bank. Your deposited cash is an unsecured debt obligation of your bank. If your bank is one of the country’s biggest banks, who collectively have trillions of dollars of derivatives which they hold “off balance sheet” and not recorded on banks’ GAAP (Generally Accepted Accounting Principles) balance sheets, those “debt bets” have a superior legal standing to your deposits and get paid back BEFORE you would get any of your deposited cash. State and local government deposits are considered “secured,” since they remain junior to the derivative claims with “super-priority.” Your hard earned money is not considered security or collateral but merely a loan to your bank and you will be forced to stand in line along with the other creditors.
The banks inserted the language and the legislators signed it, possibly without reading or understanding it, or quite possibly because they ALWAYS do the banks bidding for pay or fear. At over 2,300 pages and growing, the Dodd Frank Act is currently the longest and most complicated bill ever passed by the U.S. legislature.
Dodd-Frank states that it will “protect the American taxpayer by ending bailouts” which it does but only by imposing the losses of insolvent financial companies on their common stockholders, debt-holders and unsecured creditors, which includes depositors, the largest class of unsecured creditor of any bank. Title II of Dodd-Frank ensures payouts to claimants under bankruptcy liquidation but only after superior derivative claims are paid out.
The largest Over the Counter (OTC) derivative market is made up of banks and other highly sophisticated players such as hedge funds. OTC derivatives are the bets of these financial players against each other. Derivative claims are considered “secured” because collateral is posted by the parties. While there’s no way of knowing for sure it is estimated that the face value of all derivatives outstanding tops a quadrillion, or $1,000 trillion dollars, more than 14 times the entire world’s annual GDP. The total value of all the stocks trading on the New York Stock Exchange is roughly $15 trillion and the New York Stock Exchange is itself being acquired by an up and coming derivatives exchange.
Don’t expect the Federal Deposit Insurance Corporation (FDIC) to bail out depositors either (insurance covers up to $250,000). While only reporting $7 Billion on their books there is an estimated $7 Trillion in deposits in the U.S. today. The FDIC’s website answers the million dollar question by reporting this writer’s article, “Are depositors always guaranteed to receive the insured amount in the case of a bank failure? This need not always be the case because the FDIC does not have sufficient reserves to bail out all banks. However, recent experience shows that governments tend to use taxpayer money to bail out banks when the insurance agency (FDIC) does not have sufficient funds to cover bank loses.” May 28, 2013 Wall Street Journal article by Alex Polluck entitled “Deposits Guaranteed Up to $250,000, Maybe.”
The FDIC has a credit line with the Treasury, but even that only goes to $500 billion and who would pay that massive loan back? The FDIC fund also must stand in line behind the bottomless black hole of derivatives liabilities. In the U.S. today depositors are actually in a worse position than Cyprus deposit-holders because in the U.S. the big banks are playing with your money in the super dangerous derivative casino. Regulators turn a blind eye as banks use depositor funds to invest in derivatives. Your deposits WILL be wiped out by a major derivatives loss!
Their goal of the bail-in scheme is to place losses on private creditors. The Glass-Steagall Act needs to be reinstated to put a fire wall between the banks risky investments and your bank deposits. Local legislators would be wise to advocate setting up publicly owned banks on the model of the state owned Bank of North Dakota whereby banks are forbidden to gamble in derivatives and are safe places to store local public and private depositor funds.
The whole Federal Reserve System was designed to slowly drain the massive wealth of the American people and transfer it to the elite international bankers. Your ongoing struggle to maintain your family’s home while paying your bills and making ends meet is not a reflection of your lack of talent but the only possible outcome of having a parasite affixed to your body, your retirement plan, and your family’s economic future. These central planners have arranged for industry and labor to serve them through finance, not the other way around!
Thank you to Roxanne Lewis of www.whynotgold.com
The Deviant Investor