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Thursday, September 29, 2011

Why is your $ in a bank?- Part Deux

I wrote a posting last week explaining why it is absolutely silly to keep your money in a bank minus what you may need to pay bills with.   You get no interest, you're limited (really its control) as to how much you can take from an ATM, the bank is able to lend out to others at high interest the amount it holds of its depositors, and if/when there's a market crash & banks go on 'holiday', you will not be able to access your money as government works to stem off panic.

So here's another reason to add to the list:

"Bank of America plans to start charging customers a $5 monthly fee for using their debit card to make purchases. The fee will be rolled out starting early next year (2012).  A number of banks have already either rolled out or are testing such fees. But Bank of America's announcement carries added weight because it is the largest U.S. bank by deposits...  Chase and Wells Fargo are also testing $3 monthly debit card fees in select markets. Neither bank has said when it will make a final decision on whether to roll out the fee more broadly." (AP)

Personally, I keep enough funds in a bank to pay bills and to cover potential emergencies like if the A/C or Heater breaks and you need a serviceperson to fix it, etc...  Other than that, I do not allow a bank to control my money...  or me.
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I was going to end the above posting short and sweet, but this really needs to be said, since Very Few other finance blogs will do so.  We as individuals and collectively as people are pretty much powerless to stop The Federal Reserve, the Treasury and Wall St. as they work together to destroy the middle class and decimate the poor.  There's only one legal option individuals have to hurt the banks--  taking $$ out.

Banks don't want you taking out your cash. As it stands, ATMs limit you to $500 per day and if you take out $10,000 cash or more, like gestapo, you're reported to the IRS.   Try even taking out $5,000 and you're looked upon as criminal by the teller.

Remember, fractional reserve means for every $10 a bank holds of a depositor, it is allowed to lend out $100.  So if you have $20,000 in your checking or savings account, you're allowing the bank $200,000 to invest in the market or lend out and profit at 3-10% depending on loan while you get a hundredth of one-percent in return.  If just one million people nationwide could be organized to withdraw just $1,000 at a co-ordinated time, that would pull 1 Billion dollars in cash from the banks, depriving them of $10 Billion in lending.

If you love banks, keep doing as you're doing, and don't forget to take a free lollipop on your way out the door.  If you feel otherwise, take figurative and literal Control of your money.

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