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The blatant lie at the core of banking: "You can get your money back any time." The truth: You can't.


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2023 Mar 13, 1:51pm   6,608 views  66 comments

by Patrick   ➕follow (55)   💰tip   ignore  

US banking, and probably most of world banking, is based on the blatant lie that you can get your money back any time. But you can't.

Banks lend out almost all of your money to earn interest, duh. Those loans are not for 30 minutes. They often for 30 years.

The bank can't get all depositors' money back instantly. It's impossible. And yet banks promise to do the impossible, knowing full well that they cannot.

When you deposit money in a bank, you are making an unsecured loan to the bank. The bank does not put up any collateral that you can keep, unlike the situation when you borrow money from the bank.

The FDIC exists to reassure people that they can get at least the first $250K back (eventually, not instantly) even if the bank defaults. But even the FDIC has less than 2% of bank assets. If there is a run on more than 2% of FDIC insured deposits, the FDIC itself will fail. They are also lying.

Why the lies? Because the more money the bank can lend out, the more interest it gets. Profit.

The toxxine mandates proved beyond any doubt that the CDC/FDA/NIH are all run by the pharma mafia in the sole interest of that mafia, without regard to public health.

Why would we think banking is any different?

The answer is to openly and clearly mark all deposits as UNSECURED LOANS TO BANKS so that everyone is reminded of this all the time.

https://patrick.net/post/1303173/2017-02-19-patrick-s-platform


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4   clambo   2023 Mar 13, 2:30pm  

I remember an episode of the Beverly Hillbillies when Granny wanted to put her money in another guy's bank; the other bank guy smooth-talked her into changing.

She went down to the Commerce Bank of Beverly Hills and asked for her money; she brought some paper bags for it. It was millions of dollars.

"We don't have the money here right now."
"Jed, I told you they were stealing our money!"
5   ElYorsh   2023 Mar 13, 2:44pm  

The Beverly Hillbillies had more wisdom than most people have today.
7   AmericanKulak   2023 Mar 13, 6:48pm  

The Amount the FDIC has vs. the Amount Insured


Karloff says






"Why, give me your shiny silver, and I'll give you this handy banknote you can redeem for silver at your convenience. heh heh heh."

Silver currency, and all salary, contracts, and wages under $1000 must be paid in the metal, not banknotes.
8   NuttBoxer   2023 Mar 13, 7:01pm  

Eric Holder says


NuttBoxer says


Look at all the small banks that have failed over the years, where depositors lost everything. Not just over $250k, e-v-e-r-y-t-h-i-n-g.


Wait, there are failed banks which were FDIC-insured but depositors lost everything? Can we have some examples please?



For sure. See any of the banks involved in the S&L scandal, and the now defunct FSLIC, replaced by drum roll... the FDIC!

"Depositors were lucky to get 65 cents on the dollar, and even that was expected to take up to 10 years."
Griffin p72(cites US News and World Report, March 25th, 1985).
9   Eric Holder   2023 Mar 13, 7:07pm  

NuttBoxer says

Eric Holder says



NuttBoxer says



Look at all the small banks that have failed over the years, where depositors lost everything. Not just over $250k, e-v-e-r-y-t-h-i-n-g.


Wait, there are failed banks which were FDIC-insured but depositors lost everything? Can we have some examples please?




For sure. See any of the banks involved in the S&L scandal, and the now defunct FSLIC, replaced by drum roll... the FDIC!

"Depositors were lucky to get 65 cents on the dollar, and even that was expected to take up to 10 years."
Griffin p72(cites US News and World Report, March 25th, 1985).


But that's not FDIC. Ancient history.
10   GreaterNYCDude   2023 Mar 13, 7:12pm  

Fractional Reserve Lending works... until it doesn't. SVB (who I had few had heard of until Thursday March 11) was the second biggest bank failure ever in the US. SECOND. BIGGEST. EVER. The swiftness with which SVB collapsed makes this one feel "different" to me than 2008. At least then, you heard rumblings a few days, maybe even a week before things imploded. This time, things fell apart in, by all accounts, a matter of hours.

Granted SVB made some ill-timed decisions, and the cooperate governance is suspect, dumping shares in advance of today's BK filing. That notwithstanding, in this day and age, with the right amount of disinformation, one could almost create a bank run, and thus engineer a collapse, out of whole cloth.

For example, what if every account holder a local branch of XYZ bank wanted to close their accounts in exchange for cash. Not a bank cheque, not an IOU, but cold hard (fiat) US currency? How long would it take for the branch to run out of cash on hand money? Now picture this happening at a second branch, then a third. As word got out, things could quickly snowball out of control. Not to mention the less a bank has in assets, the less then can loan out due to reserve ratio requirements. Any lending institution would go from solvent to insolvent quickly. I'm too young to remember the Savings & Loans scandals of the 90's but it seems that, to a certain extent, history is repeating itself.

The entire banking system, the concept of money even, is predicated on two things. Value and Trust. And when trust is broken, it is difficult to get it back. If this starts to spread, do you think Congress would have the audacity to bail out the banks a second time in under twenty years? With what money? We still have the debt ceiling debacle, which still needs to play out. This could get ugly quick.
11   HeadSet   2023 Mar 13, 7:31pm  

cisTits says


And, I think all retail banks should be forced into becoming depositor owned credit unions.

You do have the freedom to use Credit Unions and not banks. Also, one can keep no more than $250k in any one account.
12   Patrick   2023 Mar 13, 8:06pm  

The credit unions have something like the FDIC, but it's a different organization.
13   NuttBoxer   2023 Mar 14, 9:41am  

Eric Holder says

But that's not FDIC. Ancient history.


What do you think will happen when the same situation repeats again? Just because something gets rebranded, you seriously believe it's different? In that case I guess you believe the USSR really doesn't exist anymore, that Russia was peacefully overthrown, and the old leaders and KGB no longer have any say there...
14   NuttBoxer   2023 Mar 14, 9:44am  

GreaterNYCDude says

The entire banking system, the concept of money even, is predicated on two things. Value and Trust.


Let me correct that for you, deception and force. They force you to use fractional reserve debt notes, so the bad money chases out the good, and deceive you that the system is stable, despite the fact that we've had a financial boom/bust cycle every decade since 1913.
15   Reality   2023 Mar 14, 10:49am  

In addition to the fundamental fraud in banking, SVB exposed another Ponzi Scam: SVB lent to clients that no other bank would lend, on the requirement that the borrower deposit all the company's working funds at the bank. If SVB starts with $100 deposit from Joe Schmo, it can then lend to AcmeTech1 $1000 (assuming a 10% reserve requirement; in reality, the banking reserve requirement was 4-5%, so could lend over $2000 on $100 reserve) on requirement that AcmeTech keeps $900 as deposit at the bank while it spends $100; now with that $900 "deposit," SVB could lend out $9000 to AcmeTech2 and AmeTech3, and so on. It's an amazing pyramid scheme with very little real money at the base level. The government have just bailed out a ponzi scam.

In essence, SVB got around the interest limit imposed by regulators by making loans to clients that no other bank would lend to, on requirement that the borrowers kick back bulk of the loan as "deposit.".
16   pudil   2023 Mar 14, 11:07am  

Still waiting for any example of anyone ever losing money in an FDIC insured account.

It has never happened and will never be allowed to happen. Worst case with a banking failure is that you might have restricted access to funds for a short period. But that mostly just means you won’t be able to liquidate entire accounts. Companies will still make payroll, deposits and assets will be sold to other banks and we will move on.

But by all means, convert your cash to silver and pay to store it in a safety deposit box. No one is stopping you, we all have that option if you don’t believe in the traditional banking model that has been around for hundreds of years.
17   Reality   2023 Mar 14, 11:28am  

pudil says


Still waiting for any example of anyone ever losing money in an FDIC insured account.

It has never happened and will never be allowed to happen. Worst case with a banking failure is that you might have restricted access to funds for a short period. But that mostly just means you won’t be able to liquidate entire accounts. Companies will still make payroll, deposits and assets will be sold to other banks and we will move on.

But by all means, convert your cash to silver and pay to store it in a safety deposit box. No one is stopping you, we all have that option if you don’t believe in the traditional banking model that has been around for hundreds of years.


The traditional banking model has been around for nearly 1000 years since the Knight Templar revived banking. Before that, there was traditional banking model during the time of Ancient Roman Empire and Athenian Empire as well as Carthegenian Empire before them. It's the cause of the boom-bust-and-war cycles. Usually the banksters eventually having to invite foreign invasion to destroy the books in order to avoid having to pay people back, for example: Nazi slaughter of 6+ million Jews who were middle class and upper middle class families in Europe so banks could avoid paying them back; Communists financed by banksters slaughtered of 20+ million Russians (including other eastern Europeans living in Russian Empire, such as Ukrainians, Baltics and Poles) including the upper class in their civil war, in order to void their accounts; the Corsican Italian Napoleon, son of Corsica representative to the City of London, being hired to lead a French army to destroy the books of Venetian and Genoese banks, putting an end to the Most Serene Republic of Venice (that had lasted 1000 years); Knight Templar's banking in Europe and Middleast, encouraging people to park money with them before going on the perilous journey, then after occupying Jerusalem for nearly a century sucking in enough deposits from both Europeans and Middleasterners, had to invite/provoke Saladin to conquer Jerusalem (while the Templars and Hospitalars insisting on a campaign strategy that made no sense: insisting on marching out to fight a numerically far superior enemy out in the open instead of defending very expensive state-of-the-art walls that had always worked in fending off Saracens). Now looking back, the Athenian campaign to Sicily (Syracuse) hundreds of miles away during their war against nearby Sparta made little sense except as a deliberate effort to lose the war so that Athens could be taken over by Sparta to void the banking books (and Sparta indeed treated Athenians with kid gloves during their occupation). The falls of Carthage and Tyre likewise made little sense from the initial strategic disposition. The banking industry seems to be a parasite that brings plague to one host after another.

While we are at it, let's not forget the systemic deliberate overdose prescription of Asprin at toxic levels a century ago pretending to be "Spanish Flu," sudden systematic embracing of blood-letting therapy bleeding patients to death another century before that despite having had thousands of medical experience with how bleeding kills people, then the deliberate grinding up of dead patients' skin to spread in the town squares in hopes of more people getting sick during the original "pandemic" plague . . . all in hopes of killing bank account holders and hospitals keeping all the dead ex-patients' belongings. That was hundreds of years of history before the latest plandemic. Are you enjoying being farmed like sheep yet?
18   GNL   2023 Mar 14, 12:01pm  

NuttBoxer says

GreaterNYCDude says


The entire banking system, the concept of money even, is predicated on two things. Value and Trust.


Let me correct that for you, deception and force. They force you to use fractional reserve debt notes, so the bad money chases out the good, and deceive you that the system is stable, despite the fact that we've had a financial boom/bust cycle every decade since 1913.

"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered..."
19   Ceffer   2023 Mar 14, 12:06pm  

Taxation through inflation. Feeling a little light in those retirement accounts and savings vs. purchasing power?

20   Blue   2023 Mar 14, 12:21pm  

Inflation has always been a stealth tax as the people revolt by asking more tax money. Keeping all the assets in cash is the easiest way for gov/thieves to reach you which is the case unfortunately for lot of poor and lower middle class.
21   mell   2023 Mar 14, 1:21pm  

pudil says


Still waiting for any example of anyone ever losing money in an FDIC insured account.

It has never happened and will never be allowed to happen. Worst case with a banking failure is that you might have restricted access to funds for a short period. But that mostly just means you won’t be able to liquidate entire accounts. Companies will still make payroll, deposits and assets will be sold to other banks and we will move on.

But by all means, convert your cash to silver and pay to store it in a safety deposit box. No one is stopping you, we all have that option if you don’t believe in the traditional banking model that has been around for hundreds of years.

Agreed. Just because people want something to happen doesn't make it real. Every insured dollar will be printed if necessary. You can all your insured money out, you may have to wait a bit for larger sums, but generally that has always worked.
22   Patrick   2023 Mar 14, 1:31pm  

pudil says


But by all means, convert your cash to silver and pay to store it in a safety deposit box. No one is stopping you, we all have that option if you don’t believe in the traditional banking model that has been around for hundreds of years.


@pudil You are 100% guaranteed to lose all of the money you have in paper dollars eventually:



Silver fluctuates in purchasing power, but does not ever go to zero, as paper money does.
23   Eric Holder   2023 Mar 14, 1:44pm  

NuttBoxer says


Eric Holder says

But that's not FDIC. Ancient history.

What do you think will happen when the same situation repeats again?


Whatever is allowed by law. Obviously, it's not legal for FDIC to not pay out deposits below $250,001.

NuttBoxer says


Just because something gets rebranded, you seriously believe it's different? In that case I guess you believe the USSR really doesn't exist anymore, that Russia was peacefully overthrown, and the old leaders and KGB no longer have any say there...


It's pretty much the same except some private property is allowed and farm workers do have passports. Just like FDIC is almost the same shit as prior to S&L, but nobody with deposits under $250K can be legally forced to take a haircut.
24   mell   2023 Mar 14, 1:45pm  

Patrick says


pudil says


But by all means, convert your cash to silver and pay to store it in a safety deposit box. No one is stopping you, we all have that option if you don’t believe in the traditional banking model that has been around for hundreds of years.


pudil You are 100% guaranteed to lose all of the money you have in paper dollars eventually:



Silver fluctuates in purchasing power, but does not ever go to zero, as paper money does.


That's true, but you have the problem of safe storage etc. If you want to maintain fiat money mostly and not deal with precious metals etc., the trick is to keep as little cash as possible but still comfortable enough to weather a crisis, and invest the rest in fiat denominated assets - which most are - that appreciate with inflation as well while withdrawing the cash you need/want from profits. It's not either or, there are advantages/disadvantages to both.
25   Shaman   2023 Mar 14, 1:45pm  

Here’s the real fucked up thing about those bank failures: they didn’t have to happen!
The Fed is tasked with providing instant liquidity to banks in case of a run where depositors want their money. A short term loan from the Fed would have provided SVB with the cash it needed to operate until assets could be shuffled around. But the Fed declined to provide that short term money. As they also declined to do their job with Signature bank in NY.
Why?
There’s another agenda at play here.
26   EBGuy   2023 Mar 14, 1:52pm  

Reality says

In addition to the fundamental fraud in banking, SVB exposed another Ponzi Scam: SVB lent to clients that no other bank would lend, on the requirement that the borrower deposit all the company's working funds at the bank.


Just to add one more point to this, some of the loans were to venture backed firms in anticipation of another round of funding. To compensate for risk, the bank was also given warrants to purchase stock in the company, which, it was hoped, would get another round of funding from VCs, survive to pay off the loan, and then go public at some point. And, as Reality pointed out, all loan proceeds had to be deposited at SVB...
27   Eric Holder   2023 Mar 14, 1:52pm  

Shaman says

Here’s the real fucked up thing about those bank failures: they didn’t have to happen!
The Fed is tasked with providing instant liquidity to banks in case of a run where depositors want their money. A short term loan from the Fed would have provided SVB with the cash it needed to operate until assets could be shuffled around. But the Fed declined to provide that short term money. As they also declined to do their job with Signature bank in NY.
Why?
There’s another agenda at play here.


Is this how it really works? Any bank can just get a short term loan from the Fed at a moment's notice, no strings attached?
28   Tenpoundbass   2023 Mar 14, 1:52pm  

Nobody has a stack of cash sitting at the bank in an envelope with their name on it.
Well unless it's in a safe deposit box.

If you're covered by the FDIC then it's as good as money in the bank.
We need a stable banking system and mother fuckers need to go to jail. I say we open up every fraud case going all the way back to Nixon and prosecute everyone that is still alive like a 98 year old Nazi. Round them all up and throw them in the Jeffery Epstein Prison, not one of them Harvey Weinstein vacation resorts.
29   Shaman   2023 Mar 14, 2:06pm  

Kim has a good take on the bank collapse and how it’s more of a narrative being pushed by government and big corporations who covet customers of the failed banks.

https://youtu.be/DUBKdzG5vcY
30   EBGuy   2023 Mar 14, 2:13pm  

Eric Holder says

Any bank can just get a short term loan from the Fed at a moment's notice, no strings attached?


Normal market operations that happen at the Feds discount window require collateral that is "marked to market".
In general, the Federal Reserve seeks to value securities collateral at a fair market value estimate. Securities are valued using prices supplied by the Federal Reserve’s external vendors. Securities for which a price is unavailable from external vendors will receive zero collateral value.
Additionally, depending on the asset class, the value of the asset receives a haircut to minimize risk to the Fed. See the tables here:
https://www.frbdiscountwindow.org/Pages/Collateral/collateral_valuation

As part of emergency operations to deal with this crisis, the Fed opened a new one year loan facility (the Bank Term Funding Program) that values assets like those nasty 10 year Treasuries that did SVB in at par (instead of the market value that has fallen drastically due to the the higher interest rates). Note that agency debt and mortgage-backed securities can also be used as collateral.
https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm
31   GNL   2023 Mar 14, 3:00pm  

Tenpoundbass says

We need a stable banking system and mother fuckers need to go to jail.

We need an HONEST banking system and you can't have capitalism without bankruptcy.
32   pudil   2023 Mar 14, 3:03pm  

Patrick says

pudil says



But by all means, convert your cash to silver and pay to store it in a safety deposit box. No one is stopping you, we all have that option if you don’t believe in the traditional banking model that has been around for hundreds of years.


pudil You are 100% guaranteed to lose all of the money you have in paper dollars eventually:



Silver fluctuates in purchasing power, but does not ever go to zero, as paper money does.


Everyone understands that holding cash is losing money overtime because the interest rate is less then inflation.

Holding silver has the same issue, just in a different way. You need to pay storage costs. Every year you will need to sell some of your silver to cover those costs. Eventually you will have no silver.
33   Patrick   2023 Mar 14, 3:09pm  

Yet the silver remains valuable, as it has for thousands of years.

You don't necessarily need to pay for storage, and in fact having someone else store it for you is an additional risk. They might just keep it, or "lose" it.
34   pudil   2023 Mar 14, 3:43pm  

Patrick says

Yet the silver remains valuable, as it has for thousands of years.

You don't necessarily need to pay for storage, and in fact having someone else store it for you is an additional risk. They might just keep it, or "lose" it.


If you are just talking about holding uninsured silver in your house or something that could be stolen, lost in a fire, flood, etc then I don’t think your should be complaining about risk to losing your FDIC insured deposit in a bank.

The point is, any form of value that is not invested will lose money and go to zero over time.
35   Onvacation   2023 Mar 14, 4:53pm  

pudil says

The point is, any form of value that is not invested will lose money and go to zero over time.

NOT TRUE!
Here is a pick of one of my retirement funds:


I can buy room and board with gold now and I can buy it with gold when I retire and dig up my fund.

If I can remember where I buried it and nobody digs it up first.
36   Onvacation   2023 Mar 14, 4:55pm  

pudil says

The point is, any form of value that is not invested will lose money and go to zero over time.

You are right.
37   AmericanKulak   2023 Mar 14, 5:00pm  

Reality says


being hired to lead a French army to destroy the books of Venetian and Genoese banks,

Whoa. Napoleon's first targets were Italy, then the Dutch who had many large banks. Makes sense.

There was a huge banking scandal involving John Law financing the "Mountains of Emeralds" in Lousiana and later Lavoisier was playing games with the French Banking System. Don't be bullshitted that they killed Lavoisier for his scientific opinions, it was for his role in a banking scandal and he was the top guy.

Amazing explanation, Thanks Reality.

Also thanks for the Templars, then Medicis (who married into French Royalty, Catherine d'Medici was a murdering bitch), and the Fuggers and the Hansa. Also the Jesuits were deeply involved in banking. The whole "There was no interest banking in Europe until the 1500s" is bullshit.
38   NuttBoxer   2023 Mar 14, 8:04pm  

pudil says

Still waiting for any example of anyone ever losing money in an FDIC insured account.


I'm gonna buy SVB for a dollar, change the name to The Super Stable Bank You Can Count On, and I expect your life savings in my vault by the weekend. Because you clearly believe that re-naming something makes it different. FSLIC, FDIC, completely different!
39   NuttBoxer   2023 Mar 14, 8:08pm  

pudil says

But by all means, convert your cash to silver and pay to store it in a safety deposit box. No one is stopping you, we all have that option if you don’t believe in the traditional banking model that has been around for hundreds of years.


I'm gonna repeat myself, but it's because you keep going into the weeds and getting lost. Bad money always chases out good. Why the fuck would I pay for anything using real money(silver coin), when I can give worthless debt notes for goods and services with real value. Read what happened to especially Rhode Island after the Revolution. You assertion wasn't even true 200 years ago.

Also, if you buy coin, then keep it in a bank, where they can declare a holiday whenever they want, you really don't know what you're doing, or why.
40   NuttBoxer   2023 Mar 14, 8:15pm  

Eric Holder says

Whatever is allowed by law. Obviously, it's not legal for FDIC to not pay out deposits below $250,001.


Read a little more on the SnL crisis. And remember morality != legality. Or talk to the people who didn't get their money back.

Eric Holder says

It's pretty much the same except some private property is allowed and farm workers do have passports. Just like FDIC is almost the same shit as prior to S&L, but nobody with deposits under $250K can be legally forced to take a haircut.


Exactly! And they were, legally forced, to take pennies on the dollar. I remember this happened at other times as well, small midwest banks that didn't even pay the pennies. Will try to find it.
41   NuttBoxer   2023 Mar 14, 8:23pm  

mell says

That's true, but you have the problem of safe storage etc.


Versus the safe storage of fiat paper in places like SVB?

mell says

invest the rest in fiat denominated assets - which most are - that appreciate with inflation


Examples? Judging by the past 15 years not housing, stocks, bonds, cars, 401k's, IRA's.
42   NuttBoxer   2023 Mar 14, 8:26pm  

pudil says

Holding silver has the same issue, just in a different way. You need to pay storage costs. Every year you will need to sell some of your silver to cover those costs. Eventually you will have no silver.


I've never paid storage costs. And again, that would largely defeat the purpose...
43   NuttBoxer   2023 Mar 14, 8:27pm  

Onvacation says

pudil says


The point is, any form of value that is not invested will lose money and go to zero over time.

You are right.


Not if it's real money.

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