Quote from: Juzzers on February 01, 2014, 11:53:19 AM

Quote from: mainline on February 01, 2014, 02:33:07 AM

Quote from: Juzzers on February 01, 2014, 01:36:27 AM

...
Obviously the question is one of reserve ratios. The FDIC you put your unfounded faith in has reserves to cover 0.68% of deposits.

The issue with fiat is not that there isn't enough - it's that too much is printed and faith in it is lost as a crack up boom ensues and the mass of people suddenly realise their mass produced currency is headed into a downward spiral and dump it in favour of unprintable assets.
...

The .68% figure seems unreasonable to you? Why? Because the FDIC has often failed to make whole the users of collapsed banks?
It is not just the FDIC, though. The entire financial might of the US of A that is threatened when banks fail.
With NeoBee Danny? Not so much Cheesy

Anyhow, bitcoin financial institutions had a less-then-stellar track record, starting with the awesome Pirateat40's Bitcoin Savings and Trust and recently punctuated by Tradefortress and Ukyo.
But this time it's different.

But we've gotten pretty far off-topic. Danny *wants* to buy into a fiat bank. So you'll take on the risks of *that* bank, too

The too big to fail banks, which are now even bigger, will cause the whole US system to fall over and many other big international banks - and so FDIC covering 0.68% of deposits is a joke. It gives a completely false impression that deposits in these institutions are safe.

However, this does not mean every bank carries the same level of risk. On the contrary when faith is lost in over-leveraged casino banks, people tend to put money into smaller, more local banks.

Therefore the question is entirely about which bank Danny wants to hold a stake in, its levels of leverage and how risky its assets are. What I'm saying is, that could be a far safer prospect than any FDIC insured bank.

A great example is the Bank of North Dakota - a small state owned bank which suffered absolutely no problems during the 2008 financial crises. Why? Because it was a small, safe bank.

http://www.motherjones.com/mojo/2009/03/how-nation%E2%80%99s-only-state-owned-bank-became-envy-wall-street

Let me get this straight:

You're worried that $41 billion is not enough to insure your worthless fiat in US banks, so you invested in a curious financial instrument you don't understand, issued by a Cypriot d00d on the interwebs forum?
Who has no insurance whatsoever, not even the measly $41bn?
You invested bitcoin, the currency made great specifically by the fact that it does not need banks?

And now you think that buying into a fiat bank is also a good idea?
In that case, buy moar sharez - millions are available @ IPO price

"The human mind is a powerful thing. Give it a can of spraypaint and a brown paper bag, and it will believe anything!"