Monday, September 1st, 2014

Sorry, Your Money Is Now Frozen. Bank Runs Have Become Illegal.

The Daily Sheeple
www.TheDailySheeple.com
July 20th, 2012
Reader Views: 8,978

As the financial crisis takes its toll and any number of events threaten to completely collapse an already fragile global banking system, the Federal Reserve has stepped in with a stop-gap measure to prevent liquidity from being drained out of money market funds in the event of a panic.

What this means is that at exactly the moment when Americans need money, in the midst of a massive financial panic, access to funds will be limited or altogether restricted.

Basically, according to the Fed, the minimum balance would make the financial system more fair, reduce systemic risk and protect smaller investors who can be left with losses if larger investors in their fund withdraw cash first. The proposal would require a “small fraction” of each fund investor’s recent balances to be segregated into a sinking fund to absorb losses if the fund is liquidated. Subsequently redemptions of these minimum balances at risk would be delayed for 30 days, “creating a disincentive to redeem if the fund is likely to have losses.” In other words: socialized losses. Where have we seen this before?

But the real definition of what the Fed is suggesting is: capital controls. Once this proposal is implemented, the Fed, or some other regulator, will effectively have full control over how much money market cash is withdrawable from the system at any given moment. At $2.7 trillion in total, one can see why the Fed is suddenly concerned about this critical liquidity and capital buffer.

A key proposal in the overhaul of money market regulation suggests that money market fund managers will have the option to “suspend redemptions to allow for the orderly liquidation of fund assets.” You read that right: this does not refer to the charter of procyclical, leveraged, risk-ridden, transsexual (allegedly) portfolio manager-infested hedge funds like SAC, Citadel, Glenview or even Bridgewater (which in light of ADIA’s latest batch of problems, may well be wishing this was in fact the case), but the heart of heretofore assumed safest and most liquid of investment options: Money Market funds, which account for nearly 40% of all investment company assets. The next time there is a market crash, and you try to withdraw what you thought was “absolutely” safe money, a back office person will get back to you saying, “Sorry – your money is now frozen. Bank runs have become illegal.

Via: Zero Hedge

Even though there could never possibly be 1929 style market panic or bank runs like we’ve seen throughout history, we strongly recommend considering the acquisition and stockpiling of alternative trade instruments.

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  • http://thedailysheeple bill

    dont put your money in the bank,hide it in your house just leave enough to pay your monthly bills,beat the rush and do that NOW.
    i practice what i preach im one person that will not be at the atm or bank to get my money…I ALREADY GOT IT…HEHEHEHEHEHE SORRY BEN

    • Felix

      Great idea……until your HOUSE BURNS DOWN. Have you increased your homeowners insurance to cover the loss? How are you going to explain to your insurance agent you need to increase your coverage? They won’t cover your paper money loss. It’s your word versus theirs about how much cash you have….and guess whose words count? Only a moron puts all his eggs in one basket anyway.

      • Anonymous

        @Felix, Heard of a fireproof safe you idiot??

      • ramidus

        @Felix,

        its not called putting your eggs in one basket, its called a fire proof safe. =)

        • NewGirl

          Don’t leave your cash at home. Women can take the padding out of a wonder bra and replace it with $$$. Both genders can carry cash in money pouches hidden under the clothing. The waist type ones are very easily hidden by a shirt and can hold $10,000 in $100 bills very easily without the slightest hint it is there. Silver and gold are ok to store at home as long as you do not mind their melting… junk silver is a good example of that sort of arrangement. If there is a fire the value is not lost.

          Only hide a small amount of what you have in a safe. It is too easy to force you to open it. Have a back up safe and some throw away money in the one people can find.

          • Theba

            When I was is Viet Nam War, Military exchanged our greenbacks to military payment certifcates ( MPC)
            Illegal to be caught with greenbacks. Every so often there would be a currency exchange, old MPC traded in for new MPC. The old MPC became worthless and then illegal to use. There was a limit as to how much you could exchange. abd that was confiscated and an investigation started as to why a PFC had so much cash. The exchange occurred one day only and was annouced secretly the morning of the event.
            I imagine this occurs in most war zones due to black market trading. What would prevent Uncle Sam doing that here. Now we will be disarmed.The elites will take our food too.

  • Saq

    I think the bank runs in the US have already started, but the Banks haven’t let on. Anyone who is paying attention knows. Sadly, the sheep will be the last to know and by then to late.

  • Evie

    The money will be worthless once it cannot be manipulatef or stolen by the elite any way.

  • Ed_B

    The elite know that paper money is whipped up out of thin air like a magician’s trick. It has no real substance. They can, will, and do create as much of it as they want any time they want. Just roll those presses or add more zeros to the old money computer and… SHAZAM! There it is! Real money! Yeah, right.

    Their fiat crap house-of-cards is now hanging by a couple of threads. It won’t take much to snap the threads that remain. When (not if) that happens, the entire Ponzi system of dollars, government bonds, Wall Street, and virtually everything else that has anything to do with currency will go TU.

    The Sheeple will be stunned, of course, and will act as if this is the 1st time that they have heard of this possibility. The government toads will be galloping for their escape routes, and the rest of us will be left to sort out the mess.

    The good news is that just about any of us could set up a better economic system based on honest weights, measures, and money and the personal liberty necessary to ensure that we are free to go about our business without being physically and financially assaulted by a corrupt system at every possible opportunity.

  • nitdiver5@yahoo

    The only reason a repeat of bank runs like 1929 could “never possibly be” is because you will be locked behind concetina wire reading “FEMA CAMP” backwards.

    We are at the very last breaths of this earth age before the harpazo (Rapture). Your only hope is Jesus Christ. That has always been the only hope, but for our generation that hope is palpable. After the Rapture the last 7 years (mistakenly called the Tribulation) will start when the antichrist confirms the 7 year covenant in Daniel 9:27 by dividing Jerusalem (Revelation 11:2).

    • Anonymous

      Sry but Daniel 9: 27 is talking about Israel is not going to be the Holy land no more read it slowly.

  • Morefngdbs

    THen there are some of us who have more than 1 fire proof safe.

    Along with another hidden in the basement floor…so if you ever get robbed . You’ve got a diversion ‘safe’ with a few valuables in it. The real wealth is very well hid & my basement one, if dug out of the concrete…won’t fit out the doors !

  • Kololi

    Does this include the Credit Unions?

  • Jack

    @Kololi
    Absolutely, this warning includes the credit unions. If one should fail, the FDIC will cover it. If they ALL fail (systemic collapse) making all depositors “whole” will be impossible.

    To use an analogy: If one home catches fire (bank collapse) the fire department (FDIC) can respond and hopefully save the home. But if every home in town catches fire at the same time, all is lost.

    In a nutshell: You do not own what you do not possess, and you will only possess it so long as you are willing and able to use more force than others to keep it.

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