Saturday, September 06, 2008

Is Your Bank About to Implode? The FDIC is Hinting, YES!

By Moe Bedard as Published in Loan Safe Solutions

The lender carnage, death and destruction litter the home page of Aaron Krowne’s Mortgage Lender Implode-O-Meter like the beach at Normandy on D-Day. The infamous list has grown from September 2006 when Aaron started the website with approximately 10 failed lenders to a whopping 276 major U.S. failed lending operations today.

That comes out to about one failed lender every two days over the last two years. This is no anomaly- An anomaly is an irregularity, a mis proportion, or something that is strange or unusual, or unique.

Yes, 276 failed lenders are FAR from unique.

If you truly think about what is going on in our country right now and from the actual evidence on the website, your will realize that this is really not the “twilight zone” and our banking system is on the verge of complete collapse.

I think the question now is not “if” your bank will fail, but “when” will your bank fail.
Wall Street Journal - Exhibit A is the revelation by Federal Deposit Insurance Corp. Chairman Sheila Bair that her $45 billion deposit insurance fund may not be adequate to pay off account holders as banks continue to fail. This has been inevitable for months, but neither Ms. Bair nor Treasury wanted to admit the truth in public for obvious political reasons. Yet now we learn that the insurance fund shrank by $7.6 billion in the second quarter, bringing its reserve ratio well below the minimum required by Congress.

Quick Fact - The FDIC is a government agency that insures deposits in the U.S. against bank failure; it was created in 1933 to maintain public confidence and encourage stability in the financial system.

The frightening facts are that the US Banking system is in dire straits and our government does not want you to panic and make a run on your bank. It would be the Great Depression all over again in a heartbeat if we were all to take what little cash we Americans have out of these “insolvent” banking establishments and place it under our mattresses.

That would really make them fail and fast. But will our money be safer under our mattress than these banks of cards? Ms. Bair and the FDIC may be hinting to us all, YES!

ML-Implode has listed 276 various lenders that have met their deaths and another 19 on the ailing list of lenders “about” to implode. But only the FDIC truly knows the “true” state of our nation’s banks and the hints and news coming from this mighty agency is nothing short of frightening.

Slate - You can add the Federal Deposit Insurance Corp. to the list of entities that may be in line for a Treasury Department bailout, the Wall Street Journal reports, following an interview with the agency’s chairwoman. The FDIC is a bit cash-strapped these days as it props up failing banks across the country. It announced on Tuesday that 117 ailing banks are now under its care and that the FDIC holds an astounding $78 billion in distressed bank assets, the Guardian points out. And, the New York Times says, the FDIC sees the banking crisis going from bad to worse.
Moe Bedard - America, get your head out of the sand, turn off American Idol, turn off Squawk Box and get a clue to the true state of our economy and failing banking system. Your bank may be next!

One of our country’s fathers warned us about the banks and the evil they create over 200 years ago. Yet, here we sit, paying the price for letting these banks run wild for the last couple hundred years.

Moe Bedard is a leading expert and trusted authority in regards to loan workouts and loan modifications. Moe is the founder and President of Loan Safe Solutions, and the main contributor to He has blogged on this subject more than any other person on earth and has personally been involved in over 300 loan workouts and mortgage audits.

Analyst: FDIC Will Need Half A Trillon Dollars
Chris Whalen, managing director of Institutional Risk Analytics, in an interview on CNBC, said:
They need about a half a trillion dollars in borrowing authority, and they need a vehicle to own these banks while we triage them and sell them.The FDIC Deposit Insurance Fund currently has approximately $50 billion in assets.

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