WORLD WAKING UP to the fact that a bank deposit is an unsecured loan to a leveraged counterparty, that the FDIC insurance fund only has $128bn, that total deposits in US commercial banks=$17.6 trn, &…here’s the big one: that money itself is a confidence game (always has been).
View Reddit by BitCypher84 – View Source
I now understand what Charlie Munger meant by “Bitcoin is rat poison”. It’s going to kill all the rats…
Caitlin Long is incredibly smart. It’s wild that Custodia was denied getting a master Fed account when her bank supposedly has true 1:1 collateral of customer deposits, or at least she said something like this
Honestly, they’re not waking up at all. People will just accept it or not even understand it
Once they figure that out.. Next step is to understand that the FED (and many other central banks) are privately owned and that the money itself is fake. Paper and digits on a screen that can be created in unlimited amounts. How humanity got duped into trading their valuables and labour in exchange for it is a testament to how far society as fallen.
Crypto exchanges no better than the banks.
We’re fucked aren’t we
The OP is correct but that system is still better than the other systems historically. It’s troubling but not as troubling as living where that isn’t the system.
I’m not implying that it can’t fail. I’m just providing a little balance. I still own bitcoin because the OP is correct.
The $128B vs $17T is not a good comparison. The FDIC fund wont be depleted at all after the gov sells off SVB assets. Therefore you don’t need the FDIC fund to be $17T.
Without that context, this post is just fear mongering. I like Bitcoin, but this isn’t the way to win people over.
I got minus 10 karma for telling people 2 months ago that the fdic doesnt have the cash to cover deposits
From the Federal Reserve site March 15, 2020:
[https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm](https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm)
“***the Board has reduced reserve requirement ratios to zero percent effective on March 26***, the beginning of the next reserve maintenance period. This action ***eliminates reserve requirements for thousands of depository institutions and will help to support lending to households and businesses.***
This isn’t really that important. Depositors aren’t losing their fiat coupons. They just closed some of the franchises.
Some of that is accurate, some of it is technically true but misleading, some of it is bullshit.
The point it’s making is largely correct. Don’t see the need for the sophistry, though. The truth is enough.
It’s paper. Just god damn paper.
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A confidence game… You mean like the price of a stock/security?
Why does total deposits matter if under normal situations, FDIC only needs to cover the first $250k? In the history of the FDIC, have they ever had issues covering their required insurance?
All fiat currency is debt owed to some other entity. A hard currency like Bitcoin takes out the middleman and you can own and move your own money without a middle man. It’s beautiful but the powers that be are ugly and will do all they can to stop Bitcoin from becoming the dominant currency.
I totally get that Bitcoin can be used as an excellent inflation hedge asset, similar to gold but with some great advantages. Maybe as an investment, it works really well but I just can’t see it being used as the world’s currency to buy products for this same reason. If everyone only wants to hold Bitcoin so that it increases in value, why would you ever want to spend it?
Example: I own shares of Microsoft, I would never sell my shares or Microsoft to buy everyday goods unless I absolutely had to for survival.
I guess my point is, if you like Bitcoin as a long term investment, great, so do I, but it certainly doesn’t seem to me that fiat currency system is just going to fail, leaving Bitcoin as the only option.
And what is the value of all the loans issued by those banks, you think the banks going under suddenly writes off what you owe.
Imagine getting a 30 days notice letter to repay all your debts.
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bullish!
The f-dic only has 128 bil, but what’s the big deal? Fed daddy snaps his finger and creates the rest.
The real question is what would they damage by doing that?
If it’s not backed by gold, it’s backed by hope, and when the hope balloon pops, there are only little worthless pieces of paper left.
So I give you 10 dollars, you give me 3 Pennie’s and then go use my 10 dollars at the casino to try and make 15 dollars…and when you don’t, I don’t get my money back.
– Summary of the Banking Industry
Fuck all of that…I’m out.
Separation of money and state.
Nononono. The FDIC isn’t an insurance company like all the others, that pay claims from a general fund. Where a general fund can be exhausted out and no more claims can be paid.
It’s more like a magician, whose only trick it to create money. The $250,000 limit is actually a limit on how much inflation they are allowed to create. Them bailing out depositors is actually removing their limit. So the truth is much worse.
Yes! Tell me more! More!!!!!
Less then one percent of all bank deposits are secured by FDIC insurance.
I’m confused. Is Bitcoins price not also a confidence game? Didn’t FTX crashing drop bitcoins price by like 25%? It sure didn’t drop because more supply was added. The demand dropped off because people weren’t confident in it.
Caitlin talking about the subject in this tweet https://open.spotify.com/episode/2ZA0BGuUwZFoBRhXLSJetL?si=i50694njRViA2sTUz7caww
why cant i press the play button Madge. OP !!1!!!!!
Not all banks will fail bro. Just some, so you’ll get your money back… I hope.
Bitcoin is also a confidence game