More interesting comments from Cramer

[Fearful]

$100,000 per account maximum?

My broker told me it was per institution, not per account. You cannot buy two $100K CD’s from one bank and hope the FDIC covers them both.

[Fearful]

$100,000 per account maximum?

My broker told me it was per institution, not per account. You cannot buy two $100K CD’s from one bank and hope the FDIC covers them both.

[LA_Renter]

If they let the dollar tank you are possibly looking at $150 oil. That will act like sledgehammer on the economy. It’s a catch 22.

[LA_Renter]

If they let the dollar tank you are possibly looking at $150 oil. That will act like sledgehammer on the economy. It’s a catch 22.

[bsrsharma]

The per account rules are a bit complicated. See

http://www.fdic.gov/deposit/deposits/insured/ownership.html

If you are very concerned, you may sleep better by opening up accounts at different institutions and limiting each deposit to $100k.

[bsrsharma]

The per account rules are a bit complicated. See

http://www.fdic.gov/deposit/deposits/insured/ownership.html

If you are very concerned, you may sleep better by opening up accounts at different institutions and limiting each deposit to $100k.

[kw3393]

FDIC??? If you’re so concerned about FDIC, keep your money with the big banks like Wells Fargo, Bank of America, Citibank. If any one of them goes down, FDIC will be so insignificant, it won’t have enough in reserves to cover all the deposits. Plus, the world is probably coming to an end and the US gov’t probably has collapsed 🙂

If a person is keeping money with one of those internet banks like ING and EmigrantDirect for that extra 0.5% on CD’s and money markets, s/he must be desperate. Don’t go through the hassles of moving money from one place to another over interest rates. One would do much better by balancing money between cash and stocks, and managing daily/monthly household budgets and spendings. By driving a Honda Accord instead of a Mercedes, you’ve just created extra $30,000 in your savings.

[kw3393]

FDIC??? If you’re so concerned about FDIC, keep your money with the big banks like Wells Fargo, Bank of America, Citibank. If any one of them goes down, FDIC will be so insignificant, it won’t have enough in reserves to cover all the deposits. Plus, the world is probably coming to an end and the US gov’t probably has collapsed 🙂

If a person is keeping money with one of those internet banks like ING and EmigrantDirect for that extra 0.5% on CD’s and money markets, s/he must be desperate. Don’t go through the hassles of moving money from one place to another over interest rates. One would do much better by balancing money between cash and stocks, and managing daily/monthly household budgets and spendings. By driving a Honda Accord instead of a Mercedes, you’ve just created extra $30,000 in your savings.

[SD Realtor]

Chris you could very well be correct about the Fed… Maybe that is also what many others are betting on as they scoop up bonds… That certainly would help explain the rally. I guess it would not surprise me. I just am not altogether sure that it would help soothe the secondary market but I have no ideas of the inner workings of that part of the world.

SD Realtor

[SD Realtor]

Chris you could very well be correct about the Fed… Maybe that is also what many others are betting on as they scoop up bonds… That certainly would help explain the rally. I guess it would not surprise me. I just am not altogether sure that it would help soothe the secondary market but I have no ideas of the inner workings of that part of the world.

SD Realtor

[Arty]

I thought Fed’s primary job is to control inflation. Lowing rate will only devalue the dollars and causes major inflation while we are suffering a recession. Then we will have something wrose just like the 70s and early 80s but worse.

[Arty]

I thought Fed’s primary job is to control inflation. Lowing rate will only devalue the dollars and causes major inflation while we are suffering a recession. Then we will have something wrose just like the 70s and early 80s but worse.

[Anonymous]

The effect of the deleveraging of the credit bubble will be to destroy dollars.

The Fed (except by physical printing/monetizing of debt) doesn’t create ‘unlimited-lifetime’ dollars….. In reality it is the private banks which create the dollars when they lend out (they can lend out ‘real money’ but just put an entry on their book—you and I have to give them real dollars) and when they call in loans, as is happening to hedge funds and mortgage companies, the dollars are destroyed.

The limit of course is based on the reserve ratio banks must keep with the Fed.

What’s the Fed’s role? The Fed can significantly change the *profitability* of new loans and hence the effects on bankers.

In a credit contraction the banking system will on its own be destroying dollars, so lowering a rate may not be stupendously inflationary. But it is a balance, surely.

[Anonymous]

The effect of the deleveraging of the credit bubble will be to destroy dollars.

The Fed (except by physical printing/monetizing of debt) doesn’t create ‘unlimited-lifetime’ dollars….. In reality it is the private banks which create the dollars when they lend out (they can lend out ‘real money’ but just put an entry on their book—you and I have to give them real dollars) and when they call in loans, as is happening to hedge funds and mortgage companies, the dollars are destroyed.

The limit of course is based on the reserve ratio banks must keep with the Fed.

What’s the Fed’s role? The Fed can significantly change the *profitability* of new loans and hence the effects on bankers.

In a credit contraction the banking system will on its own be destroying dollars, so lowering a rate may not be stupendously inflationary. But it is a balance, surely.

[bsrsharma]

“If you’re so concerned about FDIC, keep your money with the big banks”

Don’t underrate FDIC so fast! In the 1980s, it was FDIC (actually another agency called FSLIC) that prevented Savings & Loan collapse from becoming a 1929. When systemic instabilities occur, a large institution is no match to US government’s full faith backing. I can well imagine Wells, BoA, Citi all going down and the world will continue, though with quite a few hiccups.

BTW, FDIC doesn’t cover “all the deposits”. There in lies the secret. It covers just enough that you don’t have to worry where you will get your next hamburger. That prevents the type of panic that caused 1929.

See http://en.wikipedia.org/wiki/Savings_and_loan_crisis

Also, if you don’t like FDIC for any reason, a good way to invest your cash equivalents is to directly buy Treasury instruments. Especially good in a potentially high inflationary regime are the TIPS (Treasury Inflation-Protected Securities)

See

http://en.wikipedia.org/wiki/Treasury_security#TIPS

http://www.treasurydirect.gov/indiv/products/prod_tips_glance.htm

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