Post Reply 
 
Thread Rating:
  • 0 Vote(s) - 0 Average
  • 1
  • 2
  • 3
  • 4
  • 5
Americans should worry about their bank deposits if congress doesn't act: Economist
09-16-2008, 02:58 AM
Post: #1
Americans should worry about their bank deposits if congress doesn't act: Economist
Posted Sep 15, 2008 12:58pm EDT by Aaron Task in Investing, Recession, Banking
Related: LEH, MER, BAC, AIG, WM, ^DJI, ^GSPC
Updated from 12:58 p.m. EDT

With the "financial storm of the century" hitting financial institutions, many Americans are worried about the safety of their bank deposits. While the FDIC insures individual accounts up to $100,000, the reaction to IndyMac's failure this summer -- lines outside retail branches -- shows Americans have limited faith in the Federal Deposit Insurance Corp., which guarantees individual accounts up to $100,000.

Update: "The banking system is safe and sound," Treasury Secretary Hank Paulson declared at a mid-afternoon press conference Monday, seeking to ameliorate such concerns.

"Nothing is more important than the stability and orderliness of our financial markets [and] regulators remain vigilant," Paulson continued. "We're working through a difficult period in our financial markets right now as we work of some of the past excesses, but the American people can remain confident in the soundness and resilience of our financial system."

But Americans are justified to be worried, says Nouriel Roubini, of NYU's Stern School and RGE Monitor, who notes there is already a "slow-motion run on retail banks" occurring nationwide.

That "run" could accelerate as people realize the FDIC fund has about $50 billion to "insure" about $1 trillion in assets at the nation's financial institutions, says Roubini. "They're going to run out of money" unless Congress acts soon to recapitalize the FDIC.

In addition, the recent spike in number of banks on the FDIC's "troubled list" is only through June, meaning even that inflated number understates the problem.

The intent here isn't to add to people's anxieties, but Roubini is one of the few market watchers to correctly predict the severity of this ongoing credit crisis. If nothing else, he says people with accounts exceeding $100,000 in value should spread their money - and the risk - among different firms.

http://finance.yahoo.com/tech-ticker/art...JI,%5eGSPC
Quote this message in a reply
Post Reply 


Possibly Related Threads...
Thread: Author Replies: Views: Last Post
  Meezan Bank wins CFA bank of the year award Lahore_Real_Estate 0 4,797 11-02-2011 12:33 PM
Last Post: Lahore_Real_Estate
  APC resolution doesn’t deter Obama Lahore_Real_Estate 0 3,760 10-01-2011 02:38 PM
Last Post: Lahore_Real_Estate
  America will be divided in Free States by 2010: Russian Economist & Ambassador LRE 2 7,827 12-28-2010 10:37 PM
Last Post: LRE
  americans scared of North Waziristan Operation! LRE 0 3,478 12-23-2010 10:34 AM
Last Post: LRE
  60% Americans believe Afghan war not worth fighting Lahore_Real_Estate 0 3,801 12-18-2010 03:53 PM
Last Post: Lahore_Real_Estate
  Pak Rulers, Teachings of Islam & americans! (Javed Ch) LRE 0 3,608 11-02-2010 09:54 AM
Last Post: LRE
  Iran doesn't need nuclear weapons: Pakistan Lahore_Real_Estate 0 4,313 10-19-2010 11:48 AM
Last Post: Lahore_Real_Estate
  PPP doesn't want clash of institutions Lahore_Real_Estate 0 3,516 09-28-2010 02:50 PM
Last Post: Lahore_Real_Estate
  Reality of americans... LRE 0 3,464 08-01-2010 02:34 PM
Last Post: LRE
  Why Media Doesn't Respect Politicians! LRE 0 3,757 07-15-2010 02:30 PM
Last Post: LRE
  Contradcitory americans policies LRE 0 3,275 05-10-2010 09:50 AM
Last Post: LRE
  Parlimentarians, their foreign deposits, their loans from Pak Banks & Pak Economy! LRE 0 4,166 04-27-2010 06:14 PM
Last Post: LRE
  US Congress delegation to arrive on 30th Lahore_Real_Estate 0 3,592 03-29-2010 02:02 PM
Last Post: Lahore_Real_Estate
  India arrests four Americans for spying nuclear sites Naveed Yaseen 0 3,753 03-25-2010 11:37 AM
Last Post: Naveed Yaseen
  gandhis, congress & india LRE 0 2,735 01-08-2010 07:39 PM
Last Post: LRE
  US doesn't want to Arrest Osama (Gnom Chomnsky) LRE 0 2,918 12-15-2009 08:42 PM
Last Post: LRE
  Good, Bad Taliban & Americans' Double Standards LRE 1 4,718 11-27-2009 02:22 PM
Last Post: LRE
  State Bank of Pakistan : 'Infrastructure Bank', Mortgage Company to be set up LahoreEstate 0 4,132 11-24-2009 08:38 AM
Last Post: LahoreEstate
  Americans buying land around Islamabad, NA body told Naveed Yaseen 0 3,321 11-20-2009 08:28 AM
Last Post: Naveed Yaseen
  Nearly 15,000 Americans admit offshore tax cheating Naveed Yaseen 0 2,999 11-19-2009 08:44 AM
Last Post: Naveed Yaseen

Forum Jump:


User(s) browsing this thread: 1 Guest(s)