The word from Wells Fargo

[fb101]

So I just got a mailing from Wells Fargo;
In short (but not exaggerated)
1)They can limit any withdrawals even in person up (down) to the daily limit of your debit card daily limit.
2)They can refuse to pay purchase debits while on hold "pending verification" for up to 30 days.
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[68Camaro]

Watch out folks. Keep your preps current. There's too much stuff going on out there; a lot of it smells. Better to be wrong and prepped, than not prepped and wrong.

[barrytrot]

And keep a bit of cash on hand too, not much but in a short term bank run cash will be useful for a few days. Until the currency bottom drops, of course, but you still need milk in those first few days

[brian0918]

I'm reading The Great Depression: A Diary now, and it's amazing how rapidly all the banks in the country shut down, and stock markets closed, while awaiting the inauguration of the dear leader in 1933. And then once he was elected, FDR had no problem decreeing bank holidays on a whim.

The bank runs mentioned in this diary go on much longer than a few days. It got to the point where people would buy and sell pass-books for frozen bank accounts, for 50 or 60 cents on the dollar, as way to get access to some money. Newspapers would print daily "pass-book market values" that depended on the quality of the bank where the deposits were frozen.

[shinnosuke]

I'm reading The Great Depression: A Diary now, and it's amazing how rapidly all the banks in the country shut down, and stock markets closed, while awaiting the inauguration of the dear leader in 1933. And then once he was elected, FDR had no problem decreeing bank holidays on a whim.

The bank runs mentioned in this diary go on much longer than a few days. It got to the point where people would buy and sell pass-books for frozen bank accounts, for 50 or 60 cents on the dollar, as way to get access to some money. Newspapers would print daily "pass-book market values" that depended on the quality of the bank where the deposits were frozen.

That's astonishing. Never heard that before. It means, of course, that we the sheeple have been beholden to the big bankers for a long time, unable to form any resistance. Then, as now, they are the source of the economic problems. We just say 'baaa' and take it.

[Bham]

I have a banker buddy that I made swear he would give me a heads up if he had something funky happen where the local branches would limit withdrawals. The fear I have is that in other countries, before devaluing the currency there is always a bank holiday and account balances get adjusted over the weekend. Will that happen to us??? I highly doubt it, but as barrytrot said, better have some cash on hand for milk and what have you. I do believe that Wells Fargo is probably setting the table for other national banks to follow suit. Unfortunately this is not a good message.

[SilverChaser111]

So I just got a mailing from Wells Fargo;
In short (but not exaggerated)
1)They can limit any withdrawals even in person up (down) to the daily limit of your debit card daily limit.
2)They can refuse to pay purchase debits while on hold "pending verification" for up to 30 days.
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That is incredibly disturbing. So, as I take it, those terms are in effect as of right now?? Unreal.

[Engineer]

Preparing for bank runs?

[IdahoCopper]

There is a form you can fill out at your bank branch to raise your debit card daily limit. You can raise it up to $10,000. I raised one of my accounts to $3,000 a few months ago.

Yes, that means I can get $3,000 out of an ATM machine.

This is a prep we all need to do.

[Hawkeye]

I haven't heard anything like that from my banks, but they are both small, local banks. I don't know if that's an advantage or disadvantage in this situation. Scary stuff.

[brian0918]

There is a form you can fill out at your bank branch to raise your debit card daily limit. You can raise it up to $10,000. I raised one of my accounts to $3,000 a few months ago.

Yes, that means I can get $3,000 out of an ATM machine.

This is a prep we all need to do.

While I agree that should be done, I wouldn't count on such a service being available when you and everyone else are desperately in need of cash at the same time. If there are massive runs on the banks, that means long lines at ATMs, and people withdrawing all the cash out of the ATMs (which won't get filled up again until a truck comes). And on top of that, banks could always simply cut off service to the ATMs. The ATMs are also reliant on the electrical grid and an internet connection back to the bank's servers, which are likewise reliant on electricity and internet connection.

[brian0918]

I haven't heard anything like that from my banks, but they are both small, local banks. I don't know if that's an advantage or disadvantage in this situation. Scary stuff.

From what I read in that diary during the Great Depression, the small banks (in Youngstown at least) were the first to close, but certainly anything is possible and this situation will likely play out differently. It all depends on how much they rely on duration mismatch (i.e. borrowing short and lending long). If they're taking all the money from their short-term deposits (e.g. CDs) and lending that money out on 30-year mortgages, there's no way they're going to be able to survive a bank run, especially in an economy where either a) housing prices are plummeting and/or b) nobody is buying homes.

[NDFarmer]

I agree with stacking some cash for the when the run on the banks happens. It will be good to have enough cash on hand to cover 1 - 3 months of the necessities. You can probably skip your house payment or rent for a month or two but until the banks open up again you will need to buy milk, bread, medications, and gasoline.

I don't like seeing that stack of cash in the safe I would rather be buying silver with it but I think it is a good idea to have it on hand.

[shinnosuke]

I'm really not trying to derail the discussion, but if gasoline is not readily available (or the cash to purchase the gasoline is not available), a good pair of walking boots and a bicycle will be very handy. If you are used to always driving everywhere, try walking to your nearest Piggly Wiggly, buy essentials for a few days and walk home.

Of course, it all depends on how long the banks are closed, which depends on how long it takes the IMF to issue us freshly printed SDRs. Good-bye, George. We'll miss seeing your face on the dollar bill.

[Hawkeye]

I haven't heard anything like that from my banks, but they are both small, local banks. I don't know if that's an advantage or disadvantage in this situation. Scary stuff.

From what I read in that diary during the Great Depression, the small banks (in Youngstown at least) were the first to close, but certainly anything is possible and this situation will likely play out differently. It all depends on how much they rely on duration mismatch (i.e. borrowing short and lending long). If they're taking all the money from their short-term deposits (e.g. CDs) and lending that money out on 30-year mortgages, there's no way they're going to be able to survive a bank run, especially in an economy where either a) housing prices are plummeting and/or b) nobody is buying homes.

That's what I was afraid of. My banks aren't "too big to fail," so they probably wouldn't get as much "propping up" from Washington. Fortunately (or unfortunately), I don't have enough money to keep much in the bank anyway.

[Kurr]

If YOU don't hold it, YOU dont own it.

[barrytrot]

If YOU don't hold it, YOU dont own it.

I've heard this said many times, but where does it come from?

The Government can declare gold illegal and even if you do hold it you are a criminal if you keep it.

I agree that holding it is FAR SUPERIOR, but regardless the Government has unlimited power on this earth and they can just say, "give me" and that's that.

After that your only recourse bears the phrase, "cold dead hands" and that's not much of an ownership either

[Kurr]

The Government can declare gold illegal and even if you do hold it you are a criminal if you keep it.

Back when I was a little younger before I changed my ways, I had another saying...

"It's only illegal if they catch you!"

If I hold it, I have control over it. Whether I turn it in or not when they say to, is MY business. Whether I want partial or full access in under MY control. Not wells Fargo, or Bank of X, or some governmental official somewhere.

If I am in control of my possesions, and meet another likeminded individual or group, we can do business unrestricted, and participate in our own economy. But if I let another hold it, and they have control over it, I must then beg (ask) and be "regulated", which I do not care for. Free Men do NOT beg to use what is theirs. They make the decision and follow through.

[mongo]

2 Top Executives at Citigroup step down. Coincidence? Time will tell.

Sort on

Mongo

Citigroup announced the resignation of CEO Vikram Pandit this morning. The website release said:

Given the progress we have made in the last few years, I have concluded that now is the right time for someone else to take the helm at Citigroup.

However, the proximity of the resignation to yesterday’s announcement of an 88% drop in third quarter net income, despite earnings exceeding expectations, cannot be ignored. The drop in income was largely due to losses on the Morgan Stanley Smith Barney joint venture, a loss, as I have already commented, from which Mr. Pandit’s bonus was somewhat unjustifiably ringfenced.

Almost as a footnote, the release also announced that COO John Havens had also resigned. The release said:

Mr. Havens said that he had already been planning retirement from Citi at year-end but decided, in light of Mr. Pandit’s resignation, to leave the Company at this time.

A replacement for Mr. Pandit has been announced – Mike Corbat – but no replacement for Mr. Havens was included in the release.

Neither Mr. Pandit nor Mr. Havens retires with any kind of pension from the bank. In addition, it looks like much of their outstanding and unvested stock and option awards will expire unexercised or be forfeited, and no severance arrangements are in place for either executive except in the event of a change of control or death or disability. For example, Mr. Pandit forfeits unvested options if he terminates his employment for any reason before the options have vested. As it happens, one third of the 500,000 stock options that were awarded last year have already vested in May this year, but all are currently underwater. Vested options he holds from before the financial crisis – with prices ranging from $244 to $366 – are even deeper underwater. As far as the restricted stock awards that were made to the executives as a result of the 2011 bonus plan, these are only subject to accelerated vesting and payment on the executive’s death, under the current circumstances these shares will continue to vest according to their normal schedule over the next four years. On the other hand, shareholder opposition to the company’s executive pay packages, with almost 55% voting against them at this year’s annual meeting, may be enough of a warning to the compensation committee to allow these awards to lapse. Both executives received just under $4 million in deferred stock during 2011 and it is likely that similar awards were made early 2012. Mr. Pandit does leave with around $21.5 million in stock he already owns, though there are restrictions on almost two-thirds of that. If this assessment is accurate, then Mr. Pandit will neither leave with an excessive payout, nor leave a significant amount of valuable compensation on the table. In this respect, at least, the compensation program would seem to be working well.

However, speculation is also rife that the departure may have been as a result of disagreements over changes to Mr. Pandit’s pay package that investors may be insisting on during the inevitable consultations following on from the negative Say on Pay vote. If this is the case, it will not be the first time a CEO has resigned over investor unease at pay packages. As I noted in a recent report on Europe’s shareholder spring, the CEOs of AstraZeneca, Trinity Mirror and Aviva all resigned following shareholder votes against pay packages and/or complaints about performance. Speculation is also rife that Mr. Pandit was ousted due to concerns over his performance, so this surprise resignation fits into the current developments very clearly. Without full disclosure on these issues – as with the very public resignations of the chairman and of the CEO at Barclays - it is difficult to know whether the Citigroup board is doing is job properly or not. One indication might be that Mr. Pandit was CEO and not chairman, and he has now resigned. Jamie Dimon, on the other hand, is chairman and CEO of JPMorgan, and remains in that position. It is infinitely easier for a board to get rid of an unsatisfactory CEO, however they may not be delivering, if that CEO is not also the chairman of the board.

[knibloe]

There is a form you can fill out at your bank branch to raise your debit card daily limit. You can raise it up to $10,000. I raised one of my accounts to $3,000 a few months ago.

Yes, that means I can get $3,000 out of an ATM machine.

This is a prep we all need to do.

I am going to do this. Currently, I can only get $500. That won't cover the bag of halves that I might want to buy. Never thought of asking for an increase before.

[Bluegill]

If YOU don't hold it, YOU dont own it.

I've heard this said many times, but where does it come from?

A former member named Ponce on the old forum used to say it all the time.

[Kurr]

Now Ponce could get a conversation goin!

[HoardCopperByTheTon]

Now Ponce could get a conversation goin!

I wonder if he still has all those nickels.

[HoardCopperByTheTon]

They don't really have to go to all that trouble. When you go to get your money.. they just tell you their computers are down.

[gresham]

I don't remember my banks mentioning a daily debit limit. Now this has me worried that they might have one that I don't know about. It all makes me not want to put very much money in the bank. Think about it, they are already limmiting how much you can spend daily and we don't even have a crisis on our hands. What are they going to do when a real disaster strikes.