My experience has been, "the bigger the bank, the bigger the crook." I remember the S & L crisis well. Keating, Bush, et al. I think the Federal Reserve should be eliminated and a return to a National Bank. The Mortgage tranches that caused the 2008 crash are still out there and larger than ever. Read the entire article partially attached.
<
Depositors ? Not Taxpayers ? Will Take the Hit for the Next ?2008? Crash Because Major Banks May Use the ?Bail-In? System >
Depositors – Not Taxpayers – Will Take the Hit for the Next ‘2008’ Crash Because Major Banks May Use the ‘Bail-In’ System
By Barbara G. Ellis, Ph.D.
" August 09, 2018 "Information Clearing House" - The Federal Reserve’s recent undermining of the Volcker Rule brings depositors closer than ever to a Cyprus-style “bail-in” in another 2008 crash. And all signs indicate another is on the way. This time, however, many U.S. banks may confiscate deposits to stay solvent because the Dodd-Frank law bars them from touching taxpayers’ monies. Indeed, most major banks have been planning the “bail-in” tactic ever since Dodd-Frank.
What’s likely to happen to depositors’ money in a major commercial bank in another 2008 crash? And for months, financial pundits and experts such as William Cohen have been warning an even bigger one is on its way because nothing has essentially changed. If it’s one of those giant too-big-to-fail types that caused that global catastrophe, chances are they’ve been planning what’s called a “bail-in” system to seize depositors’ money—temporarily, of course. But whether depositors want to withdraw $50 from the ATM for the weekend, write a cheque at the supermarket, or cash in a CD, they’ll be shut out by their banks.
And when the furious confront those banks, they’ll be told it’s an emergency and, until Monday, would they like to start procedures with the FDIC for a refund? Or accept the bank’s IOU (stocks) immediately for it? (With a failing bank, stocks (aka “equities”) would be as worthless as a Confederate dollar after Appomattox.)
Forget joining fellow depositors armed with baseball bats and AK-16s to storm the banks and retrieve money on Monday. Banks will be closed. Probably ringed by paddy wagons and well-armed police with state-of-the-art equipment to handle any “disturbance.”
Worse, depositors relying on the FDIC (Federal Deposit Insurance Corporation), banking’s insurer since 1933 to protect their money, probably will get none in these times. Although the law permits it to borrow $100 billion from the Treasury in an economic crisis—and face taxpayer rage once again—at the end of March, the fund had $56 billion in its coffers. It’s also expected to cover deposits of at least $26 billion from both domestic and foreign customers, but also derivatives that were at $550 trillion by February.
But the new bank bill (S. 2155), also known as the “bank lobbyists’ bill”, just signed into law by president Trump says stress tests now would be “periodic” and not required for banks holding less than $100 billion.
As financial writer Dean Baker described the bill:
[It] rolls back major provisions of the Dodd-Frank financial regulations of 2010, allowing banks to engage in riskier investment strategies and to hide discriminatory practices.
Written to protect bank customers after the 2008 crash, the Dodd-FrankWall Street Reform and Consumer Protection Act was designed
To promote the financial stability of the United States by improving accountability and transparency in the financial system, to end “too big to fail” [banks], to protect the American taxpayer by ending bailouts, to protect consumers from abusive financial services practices, and for other purposes.
In other words, in a financial collapse serious enough to cause Great Depression II, banksare forbidden to use taxpayer revenues resting in the Treasury’s vaults because of public rage in 2009 over making $700 billion of their tax monies available to banks."