With all the talk of mounting fraud and scandal in the financial markets giving rise to a chorus of “Get your money out now!”…this seemed like a good TGIF sendoff!
As you are probably aware your bank deposits are FDIC-insured up to $250,000 per account. What you may not have been aware of:
As of 3/30/12 ~
FDIC Balance $11.8 Billion
Bank Deposits in US $8-10 Trillion
That’s 0.001475 “fifteen hundredths of one percent” rounded up! (based on the $8 Trillion)
http://www.fdic.gov/about/strategic/corporate/cfo_report_4thqtr_11/1211_CFO_Report.pdf Not concerned yet? Let’s take a look at the derivatives exposure of 3 of the top banks:
JP Morgan:
Total Assets $1.8 TTT
Total Derivatives Exposure: $78 TTT
Citibank:
Total Assets: $1.2 TTT
Total Derivatives Exposure: $56 TTT
Bank of America:
Total Assets: $1.4 TTT
Total Derivatives Exposure: $53 TTT
(Taken from Ann’s 8/22 FDIC Statistics: Read ‘Em and Weep. More at http://barnhardt.biz/ )
Lets summarize ~
You are depending on a FDIC fund of $11.8 Billion to protect your $250,000 piece of an $8-10 TTT Pie…a Pie in the hands of Banks with less than $8 TTT in total assets combined…which is all they have to backstop $200 TTT of derivatives sitting on their balance sheets!!!
Friends, this is the financial protection equivalent of sending your kids to a Caligulized Drunken Frat Orgy armed with Fishnet Condoms!! The question isn’t, Should I Stay or Should I Go? The question is, “What in the Hell Am I Doing Here in the First Place?”
…and after you pull that plug, call your cable provider and pull that one too! 🙂
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