If you have over $100K in an account, learn from these people.

[gateley]

(And my question is, what happens when the FDIC runs out of money?)

http://www.cnn.com/video/#/video/business/2008/07/12/dcl.finnstrom.indymac.cnn

[happyslug]

1. You wait for Congress to allocate money to bale out the FDIC

That may take a few months, and by the time your money is released it may be next to worthless (i.e. Hyper-inflation may kick in at the same time as the FDIC runs out of money).

[gateley]

2. I wonder what I would do if I had money to worry about.

Withdraw it all - so I have stacks of worthless dollars?

I'm concerned about the folks who DO have this much in savings and I'd hate to see them lose it.

[deadmessengers]

4. Foreign currency.

As a hedge against the collapse of the dollar, I've been putting some of my savings in an ETF (Exchange Traded Fund) that tracks the Euro/Dollar exchange rate. While the Euro has problems of it's own, I still think that it's in better shape for the long haul than the US Dollar is, so I've been moving about a third of my savings to that fund. Not a huge amount of money, but a little "just in case" money. The exchange rate has been relatively stable for the last few months, but for a while there the dollar was in absolute freefall against most foreign currencies. My gut tells me that it's going to go into freefall again soon, and my Euro investment should pay off a bit if that happens.

[aspergris]

6. I've done the same

as well as using spot forex.

Cuurency hedging is simple and available to any investor.

[gateley]

7. Good luck!

I keep hearing money experts talking about putting their money into foreign currency (Euros, mostly). I'm glad you've done that. :thumbsup:

[A HERETIC I AM]

9. Careful

If the Fed raises rates later this year or early next (as they are likely to do) the dollar will probably rally. Keep a close eye on your foreign currency ETF.

[Dover]

18. The US dollar is the reserve currency of the world's central banks

so the entire globe is vulnerable to this ponzi scheme. The collapse will be worldwide as the U.S. defaults on its financial obligations.

[elocs]

3. The FDIC will guarantee your money, but they don't guarantee you can buy anything with it.

The old barrel full of money for a loaf of bread. If they run out of money my guess is that the government just keeps the old printing presses going.

[Mr_Jefferson_24]

5. That's exactly what they'll do and hyperinflation is exactly where we're headed.

[Tejas]

10. sadly

I had a conversation yesterday that led to a few offhand comments being made along the lines of "it's okay, .gov will just print more money, that's what .gov is there for". The sad part is that the person speaking those words was not being sarcastic.

[elocs]

11. Hence, the barrel full of money for a loaf of bread. n/t

[sendero]

12. Deflation..

.... is the eventual outcome, not inflation.

[Mr_Jefferson_24]

13. No, deflation is what's happening in the housing...

...market as supply of available homes outstrips the number of qualified buyers due to foreclosures, stagnant incomes, and less job security.

Inflation is what we'll see as the dollar continues to fall and the cost of transporting goods continues to rise.

The super wealthy will swoop in to pick of real-estate across the board at fire sale prices -- not good.

[sendero]

14. I disagree..

.... there will soon be a lot less money in circulation than there is now.

Wealth, in the form of housing and 401K values, is evaporating. Jobs will become scarce as everything winds down, and we will have a deflationary depression as people HAVE NO MONEY TO BUY THINGS.

I could be wrong, but I doubt it. It is the most likely scenario, unless the govt prints trillions of dollars, and it can't really.

[Extend a Hand]

15. The confusion arises because

people use the words "inflation" and "deflation" to mean different things

If you define inflation as an increase in the supply of money and/or credit and deflation as a decrease in the supply of money and/or credit then we are currently in a deflationary period.

If you when you talk about inflation and deflation you are talking about rising or falling prices then we are in an inflationary environment.

I think we're heading for a deflationary depression. They may try to inflate another credit or asset bubble but they aren't stupid enough to print.


I guess it's possible that if there is some big conspiracy to destroy our currency to introduce the Amero or some new currency printing might be a possibility but that just doesn't seem likely to me.

[Doctor Cynic]

8. Swiss Franc.

[Megahurtz]

16. How about Japanese Yen?

Any ideas on that? :shrug:

[Doctor Cynic]

17. The Yen has been shadowing the USD for years.

They can't afford to sell too expensive Toyotas and Playstations, so they haven't allowed the Yen to rise too much.

The Swiss Franc is partially backed by precious metals and *may* retain its value.