Bank deposit insurance - how safe your deposits
If you are like tens of millions Americans as well as hundreds of millions of other enlightened citizens of the world, you keep your cash in a form of a bank deposit. Here in the US, and I am pretty sure among European, Australian, Asian and other banks, there is an insurance provided by some government entity to cover your deposits in what used to be a rather unlikely scenario, at least in this country, that is your bank goes under. With the few recent calamities among formerly perfectly sound banks, and last three days of a total financial mayhem, you may want to ask yourself a question - how safe really your bank deposits?
The Federal Deposit Insurance Corporation better known as FDIC, insures individual accounts up to $100,000 for each account owner. So on a joint wife/husband account, you can keep $200,000 fully insured. You can also add a beneficiary that gives you another $100,000, so your total bank deposit insurance comes to $300,000. And so on.
Various credit unions have their deposits guaranteed by the National Credit Union Administration or NCUA under similar regulations. The problem, however, which was quite evident this summer by long lines outside retail branches of IndyMac is, that we, Americans have little faith in the FDIC or by the same token the NCUA. The FDIC fund has puny $50 billion to guarantee about $1 trillion in assets at the nation banks.
I wouldn't worry though, even if your bank or credit union folds, you will get insurance money as long as your account falls under $100,000 per account owner criteria. Even if the government will have to dish out far more than $50 billions it keeps, it will simply turn the printing press on to make as many $$$ as needed. That is after all what it did with Fannie, Freddie and AIG. You may have to wait a bit, but you will get what is coming to you. You can spread your cash among several banks if you have to stay with the $100,000 limit and watch your money slowly but surely lose buying power. The other is to buy gold. Today, the $70 per ounce jump in spot gold price represents the biggest one-day increase in dollar terms since probably 1980. You can try to get some silver as well, but with ongoing silver shortage, coin and precious metal dealers put truly ridiculous mark up. So move some of your bank deposit into gold, that is the best insurance in these uncertain times.
Wed Sep 17, 2008 06:09PM | Copyright: www.bad-credit-advisor.com | More in Economy | Comments (0)
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