Let the Bank Runs Begin

As news of the Cyprus haircut unfolds, more and more people throughout the globe should start to realize that perhaps keeping all of one’s money in the bank is just as risky as keeping it under a mattress. Great Grandma remembered the events of the Great Depression and had a long-standing rational fear of trusting the banks with all of her hard-earned savings. Why? She witnessed firsthand the effects of bank closings, bank runs, and bank holidays (on said “holidays” you can’t access your money). She remembers this, but you likely don’t.

The introduction of the Federal Deposit Insurance Corporation (FDIC) backstop during the Great Depression was the US government’s solution to stabilizing the banking system of the day and restoring public confidence in depositing their cash in any US bank, no matter the size. As recently as 2008, the US government had to directly intervene—when the public again was losing confidence—as it raised the FDIC insurance limit from $100k to $250k. It also needed to inject TARP loans—in part to prevent bank runs which would surely have occurred, since banks had made risky loans to businesses and people premised upon the mistaken belief that an investor could not lose money in real estate, and that financial derivatives could be managed. By the final week of this past March, Western European depositors were questioning their own “Euro” banking system and in so doing were generating a new type of financial cancer upending widespread trust, and all a result of the banksters’ March Cyprus solution.

Our reality has become the Bizarro World of the Superman comics where everything is backward.

As countries all over the globe sink deeper into manufactured debt, politicians are getting more comfortable with the idea of nationalizing (robbing) in the name of the common good. Now, I am not claiming it will happen here in the USA tomorrow, but when our own leaders even mention above a whisper the possibility of seizing 401(k) balances as a means of resolving government debt/spending problems, that alone should send up red flags to the public signaling that concepts of “private property” are losing their sacred protection in this era of rising Progressive/Socialist politics.

Granted, Cyprus is a very small country and in the big picture should not amount to much, but now people in other countries that are insolvent—think, Greece, Portugal, and Spain—have to contend with the prospect that they could personally lose money in banks they had been regarding as safe. Imagine that you now live in Spain, where the unemployment rate is over 20%, and where circumstances continue to deteriorate (remember, their housing bubble was even bigger than ours here in the States). What is the advantage of keeping money in the bank when the risk of your institution’s going under keeps rising each passing day? Rational people would soon, and en masse across Europe, start to move their currency out of banks because of this new contagion, and seek more tangible assets that are more difficult to confiscate. Politicians know that robbing the people’s savings accounts is much easier than taxing them or placing liens on their homes. Either trust is growing, or it is shrinking. From my perspective, it is shrinking.

As I have pointed out in the past, the mainstream corporate media, which is dominated by six mega-corporations (Time/Warner, Disney, Murdoch’s News Corporation, Comcast, Viacom, and Bertelsmann), want you to believe that everything is alright and to proceed with the mindset of “that could never happen here.” They are spinning stories each day that only serve to reinforce the current power structure, which never empower the individual, but instead create a false dependency that enslaves the “average Joe” to a treadmill life. Cyprus has given us another peek behind the curtain, so to speak, as to how the “Elite” think, and from my vantage point their thinking is rather troublesome. The public will be increasingly called upon to bail out corrupt governments and companies all in the name of “the collective good.” Make no mistake, this is not a free market, it is a rigged market where gains are shared by a few and losses are shunted to the masses; in other words, profits are privatized and losses collectivized. This corrupt system will only lead to more pain and suffering for the average man, because—like ignoring a metastasizing cancer—it will not simply go away but will most likely grow until the only sure outcome is death.

Our reality has become the Bizarro World of the Superman comics where everything is backward. The more corrupt, the more dangerous, the more dishonest, the greater the reward. Steal an apple, go to jail. Launder illegal drug cartel money or poison the public with harmful drugs and receive but a nuisance fine. This permeates all levels of society from entertainment to industry to government and we just accept the lies and deceit as normal. We have a choice to just say “no” to participating and making a conscious change instead.

George Carlin summed it up best in the following rant:
“There’s a reason that education sucks, and it’s the same reason it will never ever be fixed. It’s never going to get any better, don’t look for it. Be happy with what you’ve got, because the owners of this country don’t want that. I’m talking about the real owners, now, the big, wealthy business interests that control all things and make the big decisions. Forget the politicians, they’re irrelevant.

“Politicians are put there to give you that idea that you have freedom of choice. You don’t. You have no choice. You have owners. They own you. They own everything. They own all the important land, they own and control the corporations, and they’ve long since bought and paid for the Senate, the Congress, the state houses, and the city halls. They’ve got the judges in their back pockets. And they own all the big media companies so they control just about all the news and information you get to hear. They’ve got you by the balls.

“They spend billions of dollars every year lobbying to get what they want. Well, we know what they want: they want more for themselves and less for everybody else. But I’ll tell you what they don’t want—they don’t want a population of citizens capable of critical thinking. They don’t want well informed, well educated people capable of critical thinking. They’re not interested in that. That doesn’t help them. That’s against their interest. You know something? They don’t want people that are smart enough to sit around their kitchen table and figure out how badly they’re getting [screwed] by a system that threw them overboard . . . 30 years ago.

“So, where does this leave us? Well, I just want to remind you that changing the world begins in your wallet and ends in your wallet. The key to empowering the individual is each of us changing how we spend our money. Every time you spend your money you are voting for and against something. If you don’t think fast food is good, don’t buy it. Think the Big Banks are creating a risk that endangers all of us and the American way? Take your money out and move it to a local bank. Feel that the medical system is not looking out for you? Seek other treatments.”

The power has always been in our hands. We just seem to have forgotten it. Hopefully, today you have found it again. Learn from the people in Cyprus. Take control of your life as best you can.

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