What should I do with my money in my bank?

After reading the thread,

Bank Stress Test Results LEAKED!!!

I have become more aware of what is happening with our banks today and wanted to ask for advice on what to do with my money. Currently I have a little under $20,000 in my bank account at Wells Fargo. I am not sure if Wells Fargo is in any kind of serious trouble at the moment but I’m assuming they are doing no better than the other major banks such as Citi or HBSC.

I’ve asked for advice on that thread before but I would like to go into more detail. I’m sure there’s other members here who would like some advice also.

Someone from the other thread suggested to start withdrawing my money from my account slowly and steadily and keep it in a safe at home instead. Another suggested to put money in a local bank instead.

What are some of your thoughts?


[edit on 22-4-2009 by balon0]

reply to post by balon0


you have nothing to worry about wells fargo is one of the stronger banks and are actually making good profits in the first quarter of this year

published April 9th 2009

New York (AP) — Wells Fargo & Co. said Thursday it expects record first-quarter earnings of $3 billion, easily surpassing analysts' estimates and providing an encouraging sign for the banking industry.

Wells Fargo is the first major bank to give an indication of how the first-quarter looked, and the unexpectedly upbeat news gave an immediate boost to stock futures. Several pessimistic forecasts about potential loan losses have jolted the market in recent days, and investors have been anxious as Citigroup Inc., Goldman Sachs Group Inc. and JPMorgan Chase & Co. all report next week.

Source

Nothing to worry about , at least not yet

best thing you can do is watch the stock price ... that's usually a good indication as to how your bank is doing

Been doing some research on this for now.
If it was me, would turn it over into Gold bullion, but only keep cash whats needed on hand to keep account active and pay bills yadayada.
Check into these sites.
Gold
monex
Best too keep at home in a safe due to the federal government having the power to appropriate any gold assests in private safe deposit boxes.


[edit on 22-4-2009 by MREALE]

[edit on 22-4-2009 by MREALE]

Well according to the Weiss Report, Wells Fargo is one of five major banks and four regional banks [ SunTrust Bank, Compass Bank (Alabama), Fifth Third Bank (Michigan), Huntington Bank (Ohio) and Etrade Bank (Virginia)] at risk of failure.

Meanwhile, the FDIC is danger of insolvency this year.

So, maybe the report is off, and Wells Fargo is fine. If it were my money, I wouldn't risk it. I would want to have all of my cash out by the time summer hits (although, I wouldn't suggest driving home with $20,000 under your car seat unless you live in a very safe area ).

When a report comes out and suggests that your bank is insolvent, and the FDIC issues a public warning that they won't be able to "insure" everybody if SHTF....well, lets just say that's a major "uh oh" moment.

If you're preparing for the worst, then you want to at least have enough cash to get by if there is a bank run or they declare a bank holiday.

[edit on 22-4-2009 by theWCH]

You can always send the money you have in your Bank Account to me. I'll keep it safe for you.

I'm also sure there are several Nigerian Princes who'd take good care of your nest egg too (and they promise some stellar returns).

Nah, I'm just joking...but if I didn't say it someone would have.

Seriously though, keeping a certain amount of Cash on Hand that is not kept in a Bank is *ALWAYS* a sagacious idea. However, keeping more than you can afford to lose on Hand is *NOT* a wise idea. Keeping all of your money buried in your back yard, in a box of frozen peas in your freezer, under your mattress, or in a lock-box in your closet are places just as unsafe as keeping the money in a Bank. For any kind of Emergency you do want enough Cash to survive a minimum of 2 months, but the rest of your Savings you want to keep somewhere safer than Cash on Hand.

Losing faith in the FDIC and the Banking Industry in it's entirety is actually a self-fulfilling prophecy. If people panic and make a run on all the Banks to withdraw their Savings then the worst that could have possibly happened is going to happen. As it is now, the FDIC failing is a "Worst Case Scenario" but not a likely scenario.

As with any kind of investment strategy, diversification is the key. Don't take out *ALL* of your money from the Bank, but do take out *SOME* of it and invest it other areas. Invest some in Gold. Invest some in Campbell's Soup (the investment you can really sink your teeth into!). Like was mentioned previously, keep some as Cash on Hand, but only what you need for approximately 2 months.

And if ever you worry, just pull out your Hitchhiker's Guide to the Galaxy and look at the inscription on the cover. "DON'T PANIC!"

[edit on 22-4-2009 by fraterormus]

Most likely a rhetorical question, considering the leanings of most (including me) here of late:

What does it matter where you keep cash? Is there anything backing that paper at all?

Buy precious metals and ammunition... These will be currency soon, that's why you'll get yourself on a watchlist!

TPTB are no idiots, they know the ship is sinking because the rats are all scurrying to the upper decks!

reply to post by balon0


A lot of people are saying invest in gold. Do not.

Don't invest in gold. Gold has no real value, some thing like 85% of all gold is used for nothing but jewelry and retail investment(National Geographic).

If we are worried about financial collapse having physical gold or having gold stock is not going to help you.

Gold is not the standard for currency and even if it was its only value is that people agree it has value, making it no different than paper money. If there is no economy there is no commerce which means no one agrees that arbitrary things like gold and paper money have value. Which means gold is worthless.

If you believe the leaked bank stress tests are legit, then you should believe the report that the IMF is going to start dumping gold onto the market. Gold is consistently rare, which makes gold stock consistently climb. If a large gold reserve is dumped onto the market by the IMF then gold stock value is going to take its first drop in a long time, panicking a lot of "mom and pop" gold investors and you could quickly see stock value become as low as everything else on the market.

I don't know what to tell you. If you're afraid of your bank failing, google it's strength, find other strong banks and hold multiple accounts. Maybe you should with draw a couple months worth of bills and put it in a safe in your house.

I personally am investing in a good supply of canned food and bottled water. Its my belief that there will be a total economic collapse in the US where the dollar becomes absolutely worthless. At least for a few months.

Originally posted by fraterormus
Losing faith in the FDIC and the Banking Industry in it's entirety is actually a self-fulfilling prophecy. If people panic and make a run on all the Banks to withdraw their Savings then the worst that could have possibly happened is going to happen. As it is now, the FDIC failing is a "Worst Case Scenario" but not a likely scenario.
[edit on 22-4-2009 by fraterormus]

Bank runs can't happen any more. Banks don't use the money people put in their savings accounts to run them selves. They use a fractional reserve system supported by the federal reserve.

Originally posted by srsly_you_guysBank runs can't happen any more. Banks don't use the money people put in their savings accounts to run them selves. They use a fractional reserve system supported by the federal reserve.

Precisely. They have a fractional reserve system but that doesn't prevent Bank Runs.

As of 2006 the required reserve ratio in the United States was 10% on transaction deposits, and zero on time deposits and all other deposits. So, they have basically 10% of normal deposits in reserve. So, what happens when more than 10% of their customers decide to withdraw their deposits at once?

The flaw of the fractional reserve system is when a large number of depositors seek withdrawal of their deposits, which can cause a Bank Run or, in extreme cases, a Systemic Crisis. To mitigate this problem, Central Banks generally regulate and oversee Commercial Banks, and act as lender of last resort to Commercial Banks, and also insure the deposits of the Commercial Banks' customers.

However, Central Banks are only required to hold 10% of non-time deposits in reserve as well. When the Central Banks are unable to lend all that is required to the Commercial Banks during Bank Runs or Systematic Crisis, this is where the FDIC comes in. The government takes the role that the Central Bank has failed, for whatever reason, to provide to the Commercial Banks by acting as a lender and insurer of deposits to them.

What is happening right now is that the Central Banks are failing. This is why our government has made them a priority...because if they fail entirely and a Bank Run or Systematic Crisis occurs, then the FDIC must step in, and although the FDIC insures up to $250,000 per account owner, the problem is that they don't have the reserves to handle multiple Central Bank failures and cover up to $250,000 for every account holder...just for 10% of the account holders.

In a worst-case scenario, the Federal Reserve has to step in. This is the Central Bank for the United States. However, they suffer the same limitations that other Private Central Banks have during Bank Runs or Systematic Crisis, being that their Reserves are set for normal operations, not for times of Crisis. The money deposited with the Federal Reserve, beyond the required reserve ratio is not liquid. It is made up of loans to other countries. However, they have something that the other Central Banks do not have...the U.S. Treasury. In a time of Systematic Crisis, they would have the U.S. Treasury print enough currency for the remaining amount needed to cover Commercial Bank deposits beyond what the Central Banks, FDIC, and Federal Reserve were unable to cover. This ultimately waters down the economy. Everyone with $250,000 in the bank gets $250,000 back in this situation, but that $250,000 is suddenly worth only $25,000.

Bank Runs can and still happen. We've already seen them begin to happen in the U.S., and their effect is harder on the economy than anything else currently going on. As more people panic it will get worse until, as others have mentioned, the US Dollar won't be worth the paper it's written on (as a child my grandfather gave me $100,000 in Civil War Currency. I couldn't believe that it wasn't even valuable to collectors and was so worthless he would give it to a small child to play with).

Really, the best thing that any of us can do to prevent a Systematic Crisis is to resist the urge to make a Bank Run.

[edit on 22-4-2009 by fraterormus]

reply to post by fraterormus


Now I'm a bit confused... Are you saying that a nationwide run on the banks would create an upheaval for the Federal Reserve?

What's the down side?

reply to post by srsly_you_guys
Excellent reply there.
I agree entirely that gold investment is a real bad move. An awful lot of investors are going to come seriously unstuck with this.
No currency is safe at the moment, agree 100% on buying as much tinned food and non- perishables as possible. I have been gradually buying tins for about 3 mths now.
Anyway I'm spending my savings at the mo, I've lost all faith in the banking system.
The government don't want people to save so they win----no more a saver.

If you are still keeping money in a "big bank" you are only "FEEDING THE BEAST" that is taking away the wealth of America.

You, your kids & your grandkids will still be paying off this bailout nonsense, if this country can survive that long.

You have to do what is right for you, but the way I see it, there is absolutely no financial advantage to keeping money in the Bank vs a safe in your own home. You are NOT making any significant amount of interest income, and what you do make in interest is usually taken away by some form of bank fee along the way.

WE THE PEOPLE still have more power than TPTB give us credit for. You see, TPTB will not force the failing giants (banks) into Bankruptcy/receivership but We The People can, by REFUSING to do business with them.

No accounts, no loans, no credit cards with ANY of the Giants and other TARP recipients.

But in the end, the choice is yours

Originally posted by cbianchi513Now I'm a bit confused... Are you saying that a nationwide run on the banks would create an upheaval for the Federal Reserve?

What's the down side?

As much as the Federal Reserve system is flawed (well, the whole premise of Fractional Reserve Banking is seriously flawed for that matter), this won't spell the end for the Federal Reserve at all. As long as the government is in power, the Central Bank for that government will continue to exist.

The problem is the extreme devaluation of currency via having the US Treasury print more money to cover the Fed.

If you don't mind having to cart around wheel-barrows of cash to buy a single loaf of bread then I guess it's not really a bad thing. Not every Jane and Joe is going to recognize ammo for currency since they probably don't have guns (although they may accept shiny beads in trade). Your region may vary though...but most of Suburbia don't have guns anymore...and see no value in ammo.

Sadly, the only way to get rid of the Fed is by an Act of Congress signed into Law by the President, which although an unlikely occurrence, it could happen. Although ultimately, the ideal situation would be total Banking Reform, including the Federal Reserve, moving towards a Gold Standard or closer to a Full Reserve System (or even a Hybrid System).

In the meanwhile, Preserved Food is always a safe bet in any uncertain time...matter of fact, it's good to keep around in case of any emergency. If you think Bank Runs are a scary proposition, Grocery Store Runs are far worse! Most Grocery Stores have less than a 3 day stock of most food if something were to affect their shippers or suppliers or manufacturers...and when people catch wind of that, that 3 day stock won't last longer than an hour.

[edit on 22-4-2009 by fraterormus]

reply to post by fraterormus


Thank you for the post. I'm going to have to read it again.

First I wanted to ask: Where did the civil war currency come from? Was it the currency Abraham Lincoln printed because he refused to be loaned money on interest to run the government? Or was it a confederate currency?

the great FDIC has 99 years to pay back your money .I heard this from a

bank teller is this true ? I think that its true .Can you people debunk this?

I hope you can , good luck

reply to post by fraterormus


First off I would like to say to redhatty: STAR!!! Absolutely what my point eventually comes to. I seem to remember getting an email to this effect some time ago, urging folks to witdraw all funds, including investments like CD's, etc. from the banks to force this very issue. Good rehash!

fraterormus, I agree with the validity of your post as well, I suppose I have to star you as well.

I also agree that preserved food is a really swell idea... I have a fair supply going, but have slacked off of that and other items for a while.

I live in sight line of a major grocery store, so if you want front row seats for those food riots, come on over!

In answer to srsly... I was always under the impression that Lincoln wanted to issue a debt free currency, so I would say your first guess is the closest.

Originally posted by srsly_you_guysFirst I wanted to ask: Where did the civil war currency come from? Was it the currency Abraham Lincoln printed because he refused to be loaned money on interest to run the government? Or was it a confederate currency?

It was Confederate Currency (Series 7 if I recall correctly). I think Union Currency actually retains significant collectible value...but CSA, towards the end of the War, was printed as fast as the Mint could pump it out so it was far too commonplace to have any value (although things have changed apparently in last 30 years as I noticed they go $1 for $1 with the advent of E-Bay). I suppose if I held on to them they would have been worth almost as much as my Spiderman 1-300 Comics and all my 70's era Baseball Cards would have been worth.

I have no idea where my Grandfather got it. It could have been an inheritance, or something he found in the attic. As a small child I never stopped to consider asking.

However, my maternal lineage is from a very old Southern family that supported the Union cause, albeit in secret and at a cost of generations of shame on the family name to both Northerners and Southerners alike. It is pretty likely it was sitting in a locked chest somewhere for 80 years before it was discovered by my grandfather. You really wouldn't want to know what my mother and her siblings discovered in the attic after my grandmother and grandfather passed away! Although I later found out what it was, I'm not sure the fate of it, but what to do with it was a matter of an epic debate (none of which was over money, but over ethics). The fate of the object they have all vowed to take with them to their graves.

However, since this has deviated seriously off topic...let me weave it back on topic!

US Currency if devalued, would have value to collectors a 150 years from now. In the meantime, it would be worthless under such a scenario, which was my original point. But there are a lot of odd things that become valuable to collectors during strong economic times...but that isn't what the OP was looking for most likely.

The value of anything is based upon the demand of that item in comparison to supply. People believe Gold and Diamonds to have value thus they are valuable when they rare. If they were commonplace, they would have no value as supply would outweigh demand (which is why both industries reserve it in quantity and trickle it out according to demand).

Supply & Demand. That is basically what it comes down to.

In a worst case scenario of total economic collapse, what has value? What will there be little supply of but will be highly in demand?

*First and foremost is food.
*Guns and ammunition. Those that don't have food can take it by force...and those that have food will want to keep others from taking it by force.
*Toilet Paper and other necessary Toiletries (like Toothpaste). Next to a can of soup, this will probably be the most commonly traded commodity.
*Sin Items. Booze, Cigarettes, etc. If smokers are willing to pay $50 for a pack of cigarettes now, imagine what they'll trade for a pack when they become truly scarce?
*Camping/Survival Supplies. Don't underestimate the value of a good pair of waterproof, insulated work-boots or a nice warm sleeping bag!
*Gasoline/Petrol. You think gas was spendy a year ago! Just wait!
*Electricity. Our society is dependent upon it. If you the ability to charge someone's IPod or Laptop, you have all the barter you need!
*Information. In comes in many forms too numerous to list...but they all will have a tangible value.

Best advice, if it is really something that worries you, is to go to a Retirement Home and spend a day talking to someone who actually lived during the Great Depression. I'm sure they will have lots of creative advice that the rest of can't possibly conceive.

Originally posted by fraterormus
You can always send the money you have in your Bank Account to me. I'll keep it safe for you.

Drats! I was going to say that!

Seriously ... if the financial system is going to collapse, then it won't matter if the money is in the bank or in your mattress. It'll be worthless.

And buying up gold won't do much good. You can't eat gold.

Purchase survival items and a food supply. IMHO

reply to post by fraterormus


On the gas/petrol note. If any one has the ability to make ethanol fuel in their back yard I suggest you look into it. Don't worry about permits to own a still.

Ethanol fuel can be used in any petrol engine. Have a petrol generator? You now have power when economy gets so bad you can't pay a power bill.

the banks that posted first quarter profits are solid all right LOL

thanks to one time payoff's from AIG and placing alot of losses in the month of december WHICH WAS NOT part of any earnings quarter...quite the trick if you ask someone who thinks honestly

In regards to the leaked bank tests i would say it is very likely it is a HOAX (undestand the info is true....but will not be reported as such.......(the official announcement will B.S as usual about how well capitalized they are)......Ever since they kept AIG alfoat.....this enabled them to use backdoor bailout's to other banks thru gov't bailouts at AIG.....

Anyway find a list......of supposedly safe banks that are well capitalized that could be a safe place to put money in..........(i am looking for one for you) you should look as well.