Mish calculates the potential for disaster if depositors lose confidence:
"FDIC Recap
There is $6.84 Trillion in bank deposits.
$2.60 Trillion of that is uninsured.
Total cash on hand at banks is $273.7 Billion."
So 89% of uninsured deposits are not covered by available cash in the bank.
6 comments:
I think the US govt (and the UK one come to that) should commandeer the airwaves and show nothing but "It's a Wonderful Life" starring Jimmy Stewart (the BEST Hollywood star ever) on 24 hour loop. Maybe his empassioned speech to prevent the run on the bank in the film would have some effect on a new generation of bank depositors..........
On second thoughts I suspect they would just quote Cuba Gooding Jr in Jerry Maguire - "SHOW ME THE MONEY!"
But who wants banknotes? If your account at Nank of Blair and Brown looks shonky, you probably want an electronic transfer to Bank of Gladstone and Disraeli.
Sobers, I saw the first film but not the second. It's not until I started this blog that I learned about the licence to print money that is fractional reserve banking.
DM: I learned a new word today! According to the site below, "shonky" is an Anzac expression - where did you get it from?
http://www.wordwebonline.com/en/SHONKY
Speaking of the Bank of Gladstone and Disraeli, I read recently that Dizzy once had to get a loan at 40% annual interest!
Euros are nice; the banknotes are still buying goods and services at reasonable prices round here.
Liras were very difficult. There was extra work at school learning how to write down, read and spell out such enormous numbers.
The transition from millions to billions and now trillions is having the 'big number' effect again, only in English.
I remember when a billion meant a million million, it was those exaggerating Americans that applied the term to a mere thousand million.
When the new pound is worth an old penny, there will be a marvellous opportunity to return to the duodecimal system.
Strewth, mate, used to live down under.
Post a Comment