We are seeing one of the most trying economic times of our lifetimes, and experts are saying that it’s just going to get worse. Banks are failing and the government is needing to step in, many banks are not remaining solvent, and some are struggling just to avoid a major takeover, and others still are being taken over by the FDIC, which is the government regulating agency that steps in when a bank becomes a failure, and takes over, insuring people’s deposits for up to one hundred thousand dollars as far as I know.
The run on the banks is going to cascade down further into other areas, and many people are scrambling to get their money out of their accounts if they sniff trouble in their individual banks, which causes further spiraling of economic solvency in institutions such as insurance companies and other publicly and privately owned equity corporations.
For now, what we need to focus on is staying calm about our own banks going under, and some say to look for signs that there may be trouble, although often even those that work for banks are some of the last to know about troubles. As one financial pundit says, watch out for when your bank starts putting the deposit slips on obvious display and starts to hide the withdrawal slips, as that is a sure sign that they may be in trouble.
We are even hearing about federal regulators sniffing around Wachovia for fraud possibilities, although no particular person is being investigated, but the whole company is being ivestigated for fraudulent practices. Indymac, one of the pacific northwests largest mortgage lenders, is currently being taken over by the FDIC assuming for reasons that they may have been insolvent, and need to have their deposits insured by the arm of the government who insures the customer deposits up to so much money.
These are some very scary times indeed when it comes to financial and economic security. We know people are having a hard time with it, but when the major banks who supposedly have millions or billions of dollars in backup start to buckle, that’s when people start to really freak out and lose confidence. I’m hoping that this is the last bank failure for a while but the truth is no one knows right now where this might be headed.