Account holders Protected

 Hi readers 

Market have settled down after the FIDC said it was going to make all account holders whole regardless of there size of there account. Now the documents state $250,000 so everyone is going to get there money, so we are nationalizing the banking sector. So if crooked executives make bad decision or take foolish risks they all now know that the government will bail them out . What happened to falling on your own sword. It's shit like this that makes the public frustrated at the banking institutions that have now become parasites to society.

So lets really look at this, if you look at the financials of the FDIC they have around $125 billion in reserves. Now in the US currently if they where to insure just what they have in there documentation not cover everyone whole, they need $9.9 trillion. So do the Maths on that and you will work out that just 1.2cents in the dollar is really covered.

Yesterday I had a mate read that in Australia that all banking funds are secure. Which is wonderful and I'm happy that it brings him comfort. Regardless of what he read on the article that he sent me it isn't true.

A couple of years ago banks went about change all terms and condition on account, where by money in your bank account isn't really your money. It's in the bank and you agree that should the bank have a bank run that money would be used as capital for the bank which means it's the banks money. So while there is this illusion that in Australia $250,000 is covered its not. APRA who is the Australia regulator has basically zero funds to protect account holders. But lets do the same as above lets assume that the regulator will make account holders $250,000. It will need just under $942 billion to insure all account. Now the Australian Government has $1.06 trillion in Debt. So the government will have to double the debt to cover accounts. Can you see these really happening .

Its all an illusion to give you comfort that your money is secure but its not. Its the same with the superannuation funds in Australia, All funds have a 40-50% investment in property, yet for the last 3 years office building and apartments in all capitals are at record occupancy lows, yet you never see funds writing there investments down because they are able to hide there property values from the investors due to new money continuously coming in. They do disclose the bonds and share values as they are publicly recorded. 

We are not going to be trading gold and silver to buy bread and milk . investing in these metals is a storage of wealth nothing more. We are now in a full blow deflationary cycle, and yes metals will be moving higher a lot higher over the next couple of months.

As always the above is based on Financial Astrology .

Talk to your financial advisor on the above.