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Thread: Bank failures so far

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    Default Bank failures so far

    http://news.aspects.cc/economy/bank-failures-so-far

    Failed Banks So far:

    Northern Rock
    Bear Stearns
    IndyMac
    First Integrity Bank
    ANB Financial
    Hume Bank
    Douglas National Bank
    First Heritage Bank
    First National Bank of Nevada

    Forthcoming failures(?):

    Barclays (senior execs jumping ship right now!)
    Bradford & Bingley
    HBOS
    Downey Financial
    Corus Bankshares
    Doral Financial
    FirstFed Financial
    Oriental Financial
    BankUnited Financial
    Washington Mutual

    … and many more

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    Featured Member keira0304's Avatar
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    Default Re: Bank failures so far

    wait what?? washington mutual is failing???? does that mean that we're going to lose our money? wtf.
    "Life and death, energy and peace. If I stop today it was still worth it. Even the terrible mistakes that I made and would have unmade if I could. The pains that have burned me and scarred my soul, it was worth it, for having been allowed to walk where I've walked, which was to hell on earth, heaven on earth, back again, into, under, far in between, through it, in it, and above."

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    God/dess anomar's Avatar
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    Default Re: Bank failures so far

    You're not really going to lose your money in the sense that the FDIC has insured your money up to 100,000... but it might be time to check out some credit unions!

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    Default Re: Bank failures so far

    I can't believe Washington Mutual is failing... I guess they're nice guy "Free checking" didn't really help them out. =/ I'm going to go close my account today.

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    Default Re: Bank failures so far

    Wow. WaMu??? Glad I didn't sign up with them and went to WF instead!

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    Default Re: Bank failures so far

    I would add that ...

    A. this list does not include other bankrupt banks that were forced into 'shotgun marriages' with larger banks i.e. Countrywide. The FDIC was pushing the 'shotgun marriage' angle very strongly since, if the bankrupt bank is purchased by another bank, the FDIC doesn't have to pay our insurance money to depositors. However, probably because there aren't any very large banks left that aren't also on 'shaky ground' re losses and shortage of capital, the 'shotgun marriage' angle is no longer salable by the FDIC

    B. before these banks bit the big one, the FDIC had something near $60 billion in its insurance payout fund. After the IndyMac failure and the failure of a couple of very small banks (the others on the list are 'technically bankrupt' but haven't filed for / been forced into bankruptcy yet), the FDIC's insurance payout fund is now down to the mid 40 billion range. This implies that if 1/2 dozen large banks like WaMu were to actually file for / be forced into bankruptcy, that the FDIC's insurance payout fund will be tapped out.

    C. while the FDIC is obligated to pay off up to $100,000 per insured depositor, there is nothing on the books that says the payout must happen within a certain time frame. Similarly, there is nothing on the books that says that the FDIC must continue to pay interest to depositors if insurance payouts are delayed for months or years.

    D. if 1/2 dozen big banks like WaMu do 'bite the big one', thus emptying the FDIC's insurance payout reserve, two things are possible. The first is for the FDIC to go to congress and beg for an immediate infusion of $50-$100 billion in taxpayer's money in order to immediately cover the next dozen big banks that fail. It is not a sure thing that Congress will sign on for this, since the potential exists for setting a precedent that would cost US taxpayers $1 trillion dollars if 100 big banks fail.

    E. If the FDIC's insurance payout fund is exhausted, and if the Congress doesn't agree to pony up an instant $100 billion cash infusion, then the FDIC will have to follow it's existing procedures and pay off insured depositors out of future collections of FDIC insurance premiums from insured banks. This of course would mean that depositors may have to wait months or years for the FDIC to pay them off 100%. It will also mean a major increase in the FDIC insurance premium charged to insured banks, translating into lower future interest rates being paid by those banks on savings accounts / CD's etc and higher future interest rates charged by those banks for loans.

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    Default Re: Bank failures so far

    C. while the FDIC is obligated to pay off up to $100,000 per insured depositor, there is nothing on the books that says the payout must happen within a certain time frame. Similarly, there is nothing on the books that says that the FDIC must continue to pay interest to depositors if insurance payouts are delayed for months or years.
    I was under the impression it was 7 years.

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    Default Re: Bank failures so far

    ^^^ let's hope the bank failure rate is low enough that we never have to find out ! But yes it is certainly a possibility that, for example, a person with $100,000 invested in FDIC insured CD's at a failed bank could wind up waiting several years for their $100 grand to be paid back by the FDIC ... without interest.

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    Veteran Member StuartL's Avatar
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    Default Re: Bank failures so far

    Its been a while since I read about these, but there are many others too. I recall reading about 3 mid size German banks that went under.

    Of course, the list doesn't mention the hedge funds that are pushing some of these down. The amounts 'at serious risk' right now must simply be impossible to comprehend.

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    Default Re: Bank failures so far

    ^^^ especially if you take into account 'overvalued' CDO's that must eventually be written down to 'market' values ! Merrill Lynch recently peddled 30 billion in CDO's at a DEEP discount (22 cents on the dollar on the face of it, versus typical costing on banks' books of 50 cents on the dollar), which could provide the yardstick for write-downs for other investment banks who are also up to their necks in CDO's !

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    Default Re: Bank failures so far

    Quote Originally Posted by Melonie View Post
    E. If the FDIC's insurance payout fund is exhausted, and if the Congress doesn't agree to pony up an instant $100 billion cash infusion, then the FDIC will have to follow it's existing procedures and pay off insured depositors out of future collections of FDIC insurance premiums from insured banks. This of course would mean that depositors may have to wait months or years for the FDIC to pay them off 100%. It will also mean a major increase in the FDIC insurance premium charged to insured banks, translating into lower future interest rates being paid by those banks on savings accounts / CD's etc and higher future interest rates charged by those banks for loans.
    and that's going to be real fun, i tell ya.

    i'm cashing out. screw this.

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    Default Re: Bank failures so far

    Quote Originally Posted by Melonie View Post
    ^^^ let's hope the bank failure rate is low enough that we never have to find out ! But yes it is certainly a possibility that, for example, a person with $100,000 invested in FDIC insured CD's at a failed bank could wind up waiting several years for their $100 grand to be paid back by the FDIC ... without interest.
    pfffft, does it matter? They can always print more toilet paper.

    don't you own gold from 350?

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    Default Re: Bank failures so far

    300 actually LOL !

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    Default Re: Bank failures so far

    July 30 (Bloomberg) -- The Federal Reserve extended its emergency lending programs to Wall Street firms through January after policy makers judged that markets are still ``fragile.''
    http://www.bloomberg.com/apps/news?p...FtM&refer=home

    ``There isn't anything else the Federal Reserve can do but to keep pumping liquidity into the system.''
    You keep using that word. I do not think it means what you think it means.

    The central bank also will start selling 84-day loans to commercial banks under the Term Auction Facility beginning next month, in addition to the sales of 28-day loans that have occurred since the program began in December. The biweekly sales will alternate between auctions of $75 billion in 28-day loans, and $25 billion in 84-day loans.
    Interesting.
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    Default Re: Bank failures so far

    Quote Originally Posted by Havana View Post
    I can't believe Washington Mutual is failing... I guess they're nice guy "Free checking" didn't really help them out. =/ I'm going to go close my account today.
    LOL. Its not because of that. They bought and wrote a bunch of the crappy mortgages.

    Theyve also been ratejacking everyone on their CCs with no reasons (no lates, no over limits, not maxed out) Im waiting for them to ratejack me so I can transfer over to another card and tell em to shove it.

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    Default Re: Bank failures so far

    The sky is falling! (couldn't resist)

    ahh...isn't how this happened the last time around? everyone running to withdraw money that eventually wasn't there?

    scary shit!

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    Default Re: Bank failures so far

    You missed BAC (Bank of America) I gobbled up more puts today!
    Rebecca Avalon







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    Default Re: Bank failures so far

    Bank of America is failing? My bf works there, in Muni Bonds

  19. #19
    AudreyLeigh
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    Default Re: Bank failures so far

    Good. I hate BofA. They screw the consumer any chance they get.

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    Default Re: Bank failures so far

    ^^^ it's not surprising that Bank of America is at risk here. They made it a matter of corporate policy to pursue financial services for illegal immigrants i.e. bank accounts, credit cards, even mortgages. However, now that the construction industry (which was the #1 employer for illegal aliens) is in the tank, now that FBI/ICE is 'raiding' businesses all over the country for employing illegal aliens, now that states and cities have enacting illegal immigrant employer / landlord laws with 'teeth' etc. a huge number have 'voluntarily' left the USA !



    I can't find the story online, but a just released news report estimates that some 10% or 1.2 million illegal aliens have left the USA within the last year !

    While in the process of leaving, you can be sure that paying off their B of A credit card or mortgage balances was NOT on the 'to do' list for most illegal aliens. As such, Bank of America now has the task before them of trying to identify who these people really are (versus the fake ID they presented to open their B of A accounts), and then to track them down in Mexico or other foreign countries for collection. Lotsa Luck on that B of A !


    Also, this just out on a Professional Investors' BBS ...

    (snip)"....I ***HAD*** a $12K limit on a business use [ Bank of America - sic ] Visa card for ordering materials by phone/online. Just went to use it on a small purchase and found my limit has been cut to $2300. Never a late payment, only had a $1K balance from recent orders."(snip)

    ^^^ it would appear that Bank of America is belatedly 'locking the barn door' !

    ~

    edit ... found a link to the illegal immigrant story -->
    Last edited by Melonie; 07-31-2008 at 12:37 PM.

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    God/dess Deogol's Avatar
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    Default Re: Bank failures so far

    I have been hearing stories of people with businesses finding their credit cut.

    Many banks are giving up their most stable customers in my opinion.

    All for those profits upon those with late fees, cash advance fees, etc.

    Some place will take up the mantle of the small business person and make a mint.

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    Default Re: Bank failures so far

    greaaaaat i have a cd w/ bofa...what does that mean for me im kinda scared. plus, a high limit credit card w/ them (hoping to get it paid off within the next month but stiiiill)

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    Default Re: Bank failures so far

    Quote Originally Posted by Melonie View Post
    Also, this just out on a Professional Investors' BBS ...

    (snip)"....I ***HAD*** a $12K limit on a business use [ Bank of America - sic ] Visa card for ordering materials by phone/online. Just went to use it on a small purchase and found my limit has been cut to $2300. Never a late payment, only had a $1K balance from recent orders."(snip)
    interesting. i just noticed a subtle change in my BoA statement.

    i've always had a personal line of credit with them, since NatWest days! *geeze* no big deal thing. but i just noticed they changed the description. it's always been a "personal line of credit" (with Natwest, Fleet, and now BoA) but they just changed the description to "unsecured line of credit".

    i just thought that's a very interesting (and telling) subtle change on their part. i mean, it really wasn't necessary for me to be told by them it's an unsecured but it shows they're beginning to categorize and really identify these things (along the skein of thought above). good or bad? meh, i'm not sure why they bothered to clarify it's status to me. it hasn't changed or anything. *shrugs*

    btw, i'm not an illegal.

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    Featured Member snoopy's Avatar
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    Default Re: Bank failures so far

    Quote Originally Posted by rubyredlipsss View Post
    greaaaaat i have a cd w/ bofa...what does that mean for me im kinda scared. plus, a high limit credit card w/ them (hoping to get it paid off within the next month but stiiiill)
    you're fine as long as it's under $100K and you wouldn't mind the wait to actually collect from the FDIC (but they're expediting those transactions from what i read - the vegas banks collapses).

    i think even overlimit amounts mostly/majority get paid off too (depending on yields of liquidated bank assets). but frankly, a wholescale meltdown puts everyone in the same piss pot. >.<

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    Default Re: Bank failures so far

    ^^^ as Snoopy says, your CD is insured as long as it's for an amount under $100k with all of your other B of A account balances (savings , checking ? ) included. But what ISN'T known for sure is how quickly you'll receive your insurance payout 'check' from the FDIC if and when B of A actually fails. IndyMac customers were able to get paid off almost immediately. But if the FDIC exhausts it's ready supply of cash paying out insurance 'checks' to customers of other failed banks, it's possible that you'll have to wait months or even years for the FDIC to fully pay your money back. And while you're waiting, the FDIC does not have to continue to pay interest on your CD.

    As to overlimit amounts, in IndyMac's case the FDIC decided to make a 50% 'estimated' payment based on their judgement as to the eventual cash recovery possible from IndyMac's complete liquidation. This was a voluntary move on the FDIC's part, and will certainly NOT be repeated in the future if the FDIC's cash reserves continue to shrink.

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