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Red Flags for a Looming Crisis - PART 7

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Originally Posted By: Campy
I don't like being a "Doom and Gloom", but the DOW dropped another 500 points.

My feeling is that we are going to have a "Bank Holiday" in the very near future.

I suggest you get some money out of the bank and stashed away at home (if you have not already done it). I AM NOT suggesting closing your bank accounts, just get some money out to keep at home to keep you going for several weeks, in case this holiday does happen and you can not get at any of your money for awhile.



And it might be prudent to have a back up account at another bank just in case there's a problem with your regular one.

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I am young enough not to remember any previous bank holiday. Do those affect ATM cards/debit cards/credit cards? Checks? Cashiers checks?

Someone please explain this to me!

Thanks,

Carie

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We really haven't had a "bank holiday" since early in 1933, I don't think. Essentially, such an event means the banks are closed. Period. So no, your ATM card would not work, nor your debit card at the store and your auto payments would not go through because the banks are closed to further business. This is why many are counseling to have a fair amount of cash on hand, just in case. Now it could be specific to one bank, so others wouldn't be impacted and that's why it's not a bad plan to have a 'back-up bank'.

 

But - if it were a 1933 type event, where all banks (or a majority of them) closed, I wouldn't be the least bit surprised if major retailers also shut down for the duration of the 'bank holiday' because they would not be able to do business either and would not be able to deal in anything besides cash. I'm not sure how a really nationwide bank holiday would affect retailers and others.

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Ugghh. I was afraid of that. That is not the news I want to hear right before leaving on a trip.....I am glad we have most of our money in cash. It would be a big bummer to get stuck away from home with no way to buy gas frown

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The other day when I was shopping, the whole deli counter was shut down in our small market in town. Maybe I should go back tomorrow, during the week days, and see if it is still open ??

 

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Originally Posted By: Mtn Mama
We really haven't had a "bank holiday" since early in 1933, I don't think. Essentially, such an event means the banks are closed. Period. So no, your ATM card would not work, nor your debit card at the store and your auto payments would not go through because the banks are closed to further business. This is why many are counseling to have a fair amount of cash on hand, just in case. Now it could be specific to one bank, so others wouldn't be impacted and that's why it's not a bad plan to have a 'back-up bank'.

But - if it were a 1933 type event, where all banks (or a majority of them) closed, I wouldn't be the least bit surprised if major retailers also shut down for the duration of the 'bank holiday' because they would not be able to do business either and would not be able to deal in anything besides cash. I'm not sure how a really nationwide bank holiday would affect retailers and others.



So, what would be the 'duration' of such an event? Is it usually just a few days, weeks? shrug

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I remember reading that typically when a bank closes down, it closes on a Friday and reopens on a Monday. During that time, there are people working 24-7 trying to sort out the finances, seeing what people have in the bank, how much the bank has in assets, and getting it sorted out before any transaction is allowed.

 

Now, from what I am reading, that is entirely different than a bank holiday. From Wikipedia: (admittedly not the most accurate always, but this seems reasonable) The United States Bank Holiday of the Great Depression took place in 1933 when Franklin D. Roosevelt closed the banks from March 6 to March 10 to keep depositors from bankrupting the banking system by withdrawing all their money.

 

Banks were allowed to reopen when they could prove that the money in their reserves was greater than or equal to the money that had been deposited in. If the banks were unsound they would stay closed or could apply for a government loan in order to keep from declaring bankruptcy.

 

From what this sounds like, many banks were closed and SOME did not reopen at all. I would assume that the FDIC (if a bank) would step in here, but it would be some time to get your money. Remember, they have to sort out many banks and millions of deposits.

 

Not trying to fear monger, just saying, maybe some cash on hand is not a bad thing at all.

 

 

 

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Ugh. If they use THAT criteria for allowing the banks to reopen I wouldn't think very many would be ABLE to reopen! Most banks use a 10-90 approach to the money deposited in them... they keep 10% of it and loan out the other 90%. At least that's how I understand it.

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Another red flag form my neck of the woods.

 

There are several freeway ramps that over the last 3 years of so have had a steady stream of people with signs looking for money etc. I have never not once seen a police stop and talk with the ppl. 4x in the last week I have seen police stopping and talking..

 

I've seen a major increase in the number of ppl hitch hiking.

 

 

 

 

 

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Everytime I go into the food section of Dollar General and now even Walmart, I'm noticing more and more food items are sold out! Two days ago there was plenty of cornbeef hash and tuna and the next it was nearly gone. The same goes with alot of canned vegetables and all-purpose flour. My DD#1 and I just keep plugging along and buy what we need that is available, but it sure makes ya wonder doesn't it?

 

There were only 4(2-lb.) bags of Great Northern beans left on the shelf and I bought two of them, leaving some for someone else. I figure the good lord wants us to share and if I leave some for someone else they will be able to provide for their family too. But, I will admit my survival instincts told me to buy all of them.

 

Gas prices are going down here, $3.159/gallon, but even so you don't see many vehicles cruising up and down our street and it is a main drag so to speak. People are speaking about the stock market and bank failures and you can hear the fear in their voices. Have a yard sale and people are buying "clothes and Shoes", not appliances or nic-nac's and such.

 

Makes ya wonder what is going on in peoples minds doesn"t it? Who's preping and who isn't? As for me and mine... we will continue to prep and re-assure each other that we are survivors, we descend from good hardy, pioneer stock and we will perservere.

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Originally Posted By: Mtn Mama
So no, your ATM card would not work, nor your debit card at the store and your auto payments would not go through because the banks are closed to further business. This is why many are counseling to have a fair amount of cash on hand, just in case.


I would add to this to pay your auto-pay or bill pay bills early, because you wouldn't want to get hit with late fees or other problems from a late-paid bill. I'm now scheduling all of my bill pay bills to be paid 10 days before their due date, just in case there is a problem and the banks are closed for a week. It certainly doesn't hurt anything to do this if you can.

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This was one of my questions, if the banks are closed, can we still be penalized for late payments??

 

Wouldn't there be some kind of allowance for that??

 

And what about direct deposits?

 

anyone know?

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I think it depends on if ALL of the banks are closed, as in a gov't declared bank holiday, or if only SOME of the banks are closed, as in the bank went under.

 

If ALL of them are closed, they will probably also put a freeze on payments. That's just a guess on my part, btw... but it seems logical.

 

But during the Depression, if your bank closed, and you lost all your money... you were SOL. If you didn't have a good job... you could lose everything.

 

So it's hard to say. Either way it's a sobering thought.

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It's unlikely at this point we would see a partial holiday. If it happened, it would be nation-wide to stop bank runs on the ones that aren't closed.

 

Direct deposits would likely not go through. IT would have to wait until after the holiday was over.

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I am paying my bills early as well (as best as I can, anyways)

 

BTW, the mall was totally dead. (I had a gift certificate to spend, I don't want to hang onto them) There were ladies pushing strollers, but you could clearly see they were just out to walk, not to really buy anything.

 

Also, we heard an ad on the radio for hiring for the Border Patrol. (We're not that close to the border here) They were pegging it more as keeping terrorists out in the ad.

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Ok, after reading these posts about the banks I just had to share this. Yesterday I was talking with someone who some years ago "died" on the operating table and then came back. She had the classic experiences of hovering over the table, going thru the tunnel, and then was met by two beings of light who showed and told her things. She hated having to come back. She told me she knew of 9/11 (although not the details of planes/twin towers), and she also saw this coming economic crisis and of worse to come before it is better. She confirmed that she also has stocked up but the point is, she told me to have cash on hand because she believed a bank holiday would be coming up. Those were her exact words. I have no doubts whatever about her and plan to have some cash stashed at home, even though it won't be much any little bit will be good. I am not trying to spread fear but rather to confirm what many of you have been feeling.

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I am glad right now that I have a last months rent already paid. If I cannot access my check I think the land lady will work with me and my other peers here in the bldg. I just hope it does not last more than 14 days.

I am just horrified watching the Dow tumble, and knowing its affecting everything. Ive got my utilities paid up to, this month and it would be December before they could try and cut me off now. So, just going to hunker down and be as calm as I can be by myself and with others when I interact, and email my son if it looks like we know before hand. Well, maybe I will just do that and he can see what he can do as a loan maybe, so Im in good with the landlady and have enough to add to my food stuffs a bit. Before the bank holiday hits.

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I wouldn't pay things too far ahead. In these economic times that may not be wise. Have the money available to you to use to pay the bills when they are due. As an example do a what if scenario on paying ahead. . . What if. . my utility company went under and I paid ahead? What if my landlord was forclosed on and I was evicted? They have your $$'s and you may be out.

 

You never know what someone else's financial situation is. . . be it a company or individual.

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Originally Posted By: kyles mom
I wouldn't pay things too far ahead. In these economic times that may not be wise. Have the money available to you to use to pay the bills when they are due. As an example do a what if scenario on paying ahead. . . What if. . my utility company went under and I paid ahead? What if my landlord was forclosed on and I was evicted? They have your $$'s and you may be out.

You never know what someone else's financial situation is. . . be it a company or individual.


This is what we are doing. Holding what we have and will be paying in cash or money orders. Just no telling who the economy might affect and how.

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No I am just up to date luckily. I spent 3 mos on a security deposit, first and last, so that would cover rent til end of November if need be. I wish we had someone in town that would cash a govt check, but unless you have an account, it just doesnt happen so it is direct deposit to a bank in Plattsburgh, and I can only pray I will have access to the cash amount next month within reason if there is a holiday.

If it looked like I could not do that, then thats when I talk to my son, even though he will be travelling in his work. But this first trip is overseas, for over a month, so he would be stuck too probably.

But something might be able to done, if I cannot stay put. Maybe in a round about way. somehow.

and yes this bldg is up for sale. I really wish I had a tiny cob home on some land right now that was already paid for !

 

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We are talking about Bank Holidays...

dont forget Banks will already be closed on Monday because of Columbus day... today you might want to take a little extra..if you can

 

Maranatha!

Monique

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I just talked to family that lives in central Texas. Apparently they have tried to use their debit/credit cards and were told that the stores were only taking cash from now on. I would say I was surprised, but I had that happen to me just last weekend at one place of business. Needless to say, I made another drive by my bank to take out more cash just in case it gets worse here.

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Was it a national chain store?

 

We had that happen with our florist. We have an account with them and DH called to order flowers for me on birthday. When he said to put it on our account, which had no balance, she said no it would have to be a credit card, debit card or check.

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if you are asking me about the florists downstairs, no, it was a privately owned business. She told me the owner of the building wants her to pay her own heat ( propane) during the winter. So she is closing up. There are no other storefronts in town she could use either. It is a very large space. So I don't blame her but the heating oil and propane are alot higher this far north.

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This is JUST A SUGGESTION.

 

Use your CREDIT CARD for your purchases as much as possible (just don't go in the hole doing it) and pay the bill at the end of the month so you do not have any interest charges. This way if/when the "holiday" occurs, you will have the cash on hand for the particular time period from your last payment to present.

 

If you USUALLY pay your CC online, I don't see how the CC company can legally charge you interest/late charges if THEY can not access the bank to get your payment. It is not your fault they can not get the money.

 

 

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