What Does FDIC Insurance Really Mean?
Clarifying the Top 10 misperceptions
Published: October 23, 2006
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To help depositors avoid repeating the mistakes of others, FDIC Consumer News has compiled this “Top 10” list of misconceptions that some people have about FDIC insurance. This list is based on discussions with FDIC deposit insurance specialists, including representatives at our toll-free, which handles hundreds of calls a month from consumers asking about their deposit insurance.
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Misconception 11: That when the “barbara striesand” hit the fan you’ll be OK.
When the banks start failing, the FDIC will get hit with so MANY claims the Federal Reserve, which is neither Federal, nor does it have anything in reserve, will have to subcontract to Charmin Toilet Paper to get more “dollars” to placate everyone.
What would cause the banks to start failing?
Loss of confidence in the Federal Reserve Bank Note. (Affectionately called the furbie or FRBie by it’s detractors!) When the foreigners stop sending toyotas for pretty green pieces of paper, then we’re in a world of striesand! When the sheiks want gold of oil, then we’re in a world of striesand! When WalMart wants metal aot furbies, then we’re in a world of striesand!
The Real Estate market falls off a cliff. When McMansions can’t sell at any price. Debtors will walk away leaving the house for the bank. What’s the bank gonna do with it? When the depositor walks in to get their cash, what does the bank do? Give them a basement, bedroom, or kitchen. I don’t think so. Now, we have some experience in bank runs from the Great Depression. And, some modern history in the S&L debacle in the 80s. Every homeowner ASSUMES (and we all know what that means!) that their house will increase in value and that they will be able to pay off their mortgage with dollars that are worth 5% less every year. What if that’s not true?
We, the people, in order to form a more perfect union, decide that we want “real money”. As a nation, if we stop using “dollars” and shift to say gold coins … err medallions … since the Mint thinks that only they can coin … so we use ounces of gold and silver as our “real” money. Envision that you have ten gold coins in your pocket and 70 hundred dollar furbies, which will you dump first? Yup, those furbies. That will KILL the banks. People will not be “saving” furbies with them but converting furbies to medallions. That signals the end to the era of fiat currency.
Misconception 12: That when the “barbara striesand” hit the fan, the Federal Government will stand behind the FDIC
Hmmm, politicians be counted upon to keep their promises. There’s a losing strategy!
Reinke Faces Life 
Does the FDIC help when moneys have been taken out of your account without your premission? If not what or if so what can be done to get this help? this kind of thing happens every day of the week…… Can you help me on this one? thank you
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I think this is hillarious. I’ve always known that FDIC only means that most of us will end up with “Jack” in our accounts when the going gets tough. The only coins that will be safe from the Feds is whats called “antique coinage”. Eveything else is for the taking. Insurance has always been legalized protection money with a wopping big return on your investment. If Copone and his mob did it the Gov. would put them behind bars. Get ready people, this is only the beginning. We’ve been lied to for so long most of us don’t know what the truth is.
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That was the most combobulated post I’ve ever read. This is not a time to be funny.
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