{ 19 comments… read them below or add one }

Vote -1 Vote +1Greg
October 1, 2010 at 6:58 am

Actually much worse than described. The Banks get to keep the whole million as capitol and loan a leveraged 9 Million from funny money. So, if even 10% of mortgages went to zero they are broke.

It’s a LEVERAGED house of cards. They can even bet $9 million for their own accounts in the stock market (if they want) and if they win they keep the money and if they lose the taxpayer gets to bail them out.

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Vote -1 Vote +1Carolyn Camoriano
October 1, 2010 at 7:32 am

Dear Dave, I clicked on your Facebook address and couldn’t find a link. (It was blank). Then I searched for you on http://www.Facebook.com/SurvivalDave and it said there were no results from the search. Then I checked Facebook under persons (since I am already on it). Are you the Dave with the green hair or the one with the horse? Apparently, I am a computer novice and need some help. Thanx!
Carolyn Camoriano
P.S. I think I have 2 “zombie banks” since they are categorized as D- in the list of 475 banks in trouble. Your explanation of “zombie” fits them.

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Vote -1 Vote +1David Morris
October 1, 2010 at 2:15 pm

You might want to try again…I actually clicked on the link in your post and it worked for me.

I don’t have green hair OR a horse :) My picture is simply a yellow background with “Urban Survival” written in gray/black.

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Vote -1 Vote +1TOM BURR
October 1, 2010 at 8:09 am

An abomination to all and every one. What have we come to???

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+1 Vote -1 Vote +1Jerry
October 1, 2010 at 9:53 pm

Whoa!!! A little harsh here! Let’s not start screaming the “World is Ending!” just yet. Yes, we have problems abounding, however, let’s not play to the KoolAid mindset just yet. There will be many who will drink freely from the KoolAid and just a few who decided to head for the hills. Let’s buy ourselfs as much time as we can before the bottom falls out. Ever since the Federal Reserve came into play nearly a century ago, we have always had “fiat” currency (as one of our collegues pointed out,”funny money”). It has value as long as people still have faith in it. That faith is slowly diminishing and the decrepitude that is becoming all too obvious is creeping in. As the Boy Scout motto always says,”Be Prepared”, so should we heed this timeless advice and maintain our cools when everybody else has lost their heads.

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+1 Vote -1 Vote +1James T. Collins
October 1, 2010 at 9:00 am

When no one in this country is held responsible for their own bad decisions, why do you expect business men to be held responsible? That is the root of all this financial fal de rol. When entitlement took the place of responsibility in our vocabulary the skids were greased to put us all in a third world cess pool.

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Vote -1 Vote +1Mike
October 1, 2010 at 9:05 am

Great article. I am a finacial advisor and your example is correct. But don’t feel too sorry for the ” Zombie’ Banks yet, The banks hold trillions of dollars in reserve in what is savings accounts that usually pay the saver .125 to .250% then the banks loan out the 90% of these reserves to us for credit card debt which can aquire an interest charge of 27%. Now if we use the” Rule of 72″ or the rule of doubling then the bank is doubling their reserve capital every 3 years so a bank out lay of just 1 billion will return 14.44 billion in ten yrs. This is where the banks are making hay and
the fact that the feds are covering the losses and that the feds are loaning the money interest free to the banks and that deposit insurance companies are guaranting the banks losses as wel,as their student loans. SO DON’T CRY FOR THE BANKS. CRY FOR AMERICANS WHO WANT EVERYTHING NOW. WE PUT OUR NECK IN OUR OWN NOOSE . invest in food,fix up,clean up,eat less,exercise and make do.

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Vote -1 Vote +1Jerry
October 1, 2010 at 9:55 pm

Very sound advice.

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+1 Vote -1 Vote +1mech
October 1, 2010 at 10:08 am

Problem is part of zero is still zero. The money is backed debt which is calimed as asset which means that the money is backed by debt and not asset. Tjhere is no gold or sliver behind the money. There is no hard value except opinon and paper.

Problem is that it is a house of cards. te hdebt instruments as well as the money are not fit to wipe your behind with. That is the truth of the matter.

There are how many countries around the world that owe the US money that have defaulted on loans for which our government has made no effort to collect or restructure loans to insure that paymenst are continuing to be made so that our money has actual worth because as nation we are collected on the debt that is due US.

The current world debt is such to the US that it would pay the entire federal budget each year (just the interest) and it would not be necessary for the citizenry to pay federal taxes of any kind.

As lon as we conintue to back our currency with borrowed money, the debt never decreases because there is always interest on that debt which means that more money has to be paid back than what is borrowed. THerefor as long as you continue to borrow with out paying off the debt, the debt inreases not only because of the money that is borrowed because of the interests on the loans to the government.

One cannot get out of debt by printing money faster or spend one’s way to prosperity. Both are the path to economic disaster and doom.

mech

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Vote -1 Vote +1Warren
October 1, 2010 at 10:39 am

If you are really worried about your bank, see how its doing on this list: (Remember that the rating is derived from data the banks provided more than 3 months ago… So your bank could be in worse shape that the rating indicates.)

http://www.weissratings.com/weakest-banks-and-thrifts-in-us.php

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Vote -1 Vote +1Christy
October 1, 2010 at 12:41 pm

If you go to bankrate.com you can see how well your bank or credit union is doing and it’s rating compared to other banks. This will allow you to move your money if your bank is at risk for default. If your bank has low cash reserves, you might want to move to a safer bank. A lot of the “at risk” banks offer high interest rates in order to obtain cash reserves.

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Vote -1 Vote +1Liberty Walsh
October 1, 2010 at 5:24 pm

I like to print out your info.
Why not have a box to check,”Printer friendly” so I don’t have to print out all the ads on the side columns?
You are wasting my ink and paper.
JB

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Vote -1 Vote +1Ramon
October 1, 2010 at 9:31 pm

This is an excellent article. But, why are people so enamored with “Tweeter” and or “Facebook” ?? I have never joined any of those. I have heard too many scary things about identity theft etc. I would love to obtain up to date information on the Urban Survival site, rather than joining any of those things. Please forgive me . I’m very “old Fashion” or conservative…

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Vote -1 Vote +1David Morris
October 4, 2010 at 10:33 am

Good question, Ramon.

MOST of the stories about identity theft from twitter and facebook are either urban legends or they are the result of the user doing things that give away too much information. Depending on your level of concern, you can use them without exposing yourself to identiy theft concerns. If you post your name, date of birth, address, and other information that should be private, then you could be exposing yourself to unnecessary risks.

If you’re not already using them, they’re not an effective way to get information from me, so your decision not to join may very well be the best one for you.

If you have a homepage that will allow you to customize it with RSS feeds, you can click on the little orange 1/4 circle at the top of every page and my most recent articles will be on your computer every time you start your browser.

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Vote -1 Vote +1Jerry
October 1, 2010 at 10:02 pm

Many here still miss the point altogether. It doesn’t matter if the banks are holding all the money. The money is already worthless…..it’s about power over you which they hold and how they control your lives. Gold, silver, and platinum as well as diamonds, Ferrari’s, Rolls Royces…..none of this matters if you don’t have a can of pork and beans and a jug of water to survive, the rest is totally worthless and cannot help you one iota. It is in the practical tangibles that will make a difference in your lives. Have items you can barter once the system fails and most assuredly it is going to happen. No government of man has ever survived for any great length of time given the Roman Empire which made almost a 1,000 years(and the last 700 in a state of serious decay). If you are religious and have study history….say your prayers and reread your history book…it has a tendency to repeat itself.

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Vote -1 Vote +1MP
October 1, 2010 at 10:16 pm

Everybody makes some good points about the whole banking situation; it just goes to show that we all may need to look towards going back to a cash only way of living, do away with the credit cards and use only what cash is available to you. It doesn’t make sense to borrow money at 30% interest to save 5% off of retail for an item versus waiting to save money up to just buy the damned item at retail at a better time.

While I’m not a financial advisor, I would imagine precious metals for the time being may help more in terms of investment versus “paper” stocks. But as far as saving up resources, if one has the room, I would be more willing to stockpile consumables such as food and water and fuel as those are all things that are going to be needed no matter what the economic situation. You could have $20k in cash under the mattress but if TSHTF, that $20k might only be worth $2k in usable items. When a sack of beans goes from $15 to $75 and a dozen eggs goes from $1 to $10 or fuel goes from $2.50 to $5.50 a gallon, then those who already have much of this stuff on hand are going to do a lot better than those that just took the liberty to save “money”. After a SHTF situation, even a box of matches might be worth its weight in gold when dozens of freezing families come looking for something to start a fire to cook and stay warm by.

Skills also fit into that category as the more skills you have, the more you can barter for the things you need to survive, not the things you want per se. I can fix your car for a couple of chickens and 10 lbs of potatoes; I can perform vet care to your cows in exchange for 20 lbs of beef next time one goes to slaughter. The more you know, the more you’re worth, even if you don’t have the room to store barely enough stuff for yourself, skills will go a long way to help you survive just as well as having a warehouse full of supplies.

Be prepared!

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-1 Vote -1 Vote +1Arminius9
October 2, 2010 at 7:36 am

The Community Reinvestment Act started with Jimmy Carter, then enhanced (or degraded) by Bill Clinton. Then finally Senator Chris Dodd and Congressman Baryney Frank forced the banks to give home loans to those who had no income and no means of repaying the money. The democrat socialists in the federal government declared home ownership a right under the Constitution.

What fools!

How appropriate they named the banking restructuring legislation after themselves.

All it got me was $ 240 a year in bank fees. I haven’t paid bank fees in 25 years. I consider these just another Obama tax.

Oh yes, the U.S. dollar is worthless.

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Vote -1 Vote +1Dave W
October 2, 2010 at 11:06 pm

Zombie Banks?You have to shoot them in the head.LOL
I know what you mean.I see them popping up all over.I call them Fly By Night Banks.How it works is a big bank like HSBC will open banks under another name.Then they get you to sign up on this great deal of a loan,2.3% on a 30 year mortgage.2 years later the bank goes belly up.HSBC picks up your mortgage now your stuck paying 11.7% for the next 28 years.

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Vote -1 Vote +1John Lasure
October 4, 2010 at 11:20 am

Live on SS. Am 76 have a blow gun, and other survival weapons.Can run a trot line, trap if i need to. Took a 3/4 x4″ pipe glue a cap on one end and a screw cap to the other filed it with cotton a lot of cotton and lighter fluid.Fix a striker to it for starting fire,s .will take your course some day.Thank for all the good info .

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