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Banking system sound, deposits protected, Paulson says

Associated Press

Latest comment posted at 11:49 AM EDT 21/07/08

Treasury Secretary seeks to reassure anxious public during media appearances Sunday ...Read the full article

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  1. Mark Holman from Canada writes: Oxymoron. Sound banking system, but more trouble ahead. Well, if you don't know what it is, then your not very smart or lying to the world.
  2. John Connor from Canada writes: The banking system may be sound, but the dollar is backed by -- ?
    Solution - Print more valueless paper.
    Problem solved.
  3. Yvonne Wackernagel from Woodville, Canada writes: Just a little bad news at a time because we just cannot swallow too much at once. However, I think we should not only listen to North America or Canada, because this is now a global problem and -as a lot of the real experts will tell you - it is going to take at least a couple of years before things start to turn around. Canada might not be as devastated as other countries but we are not an island unto ourselves; we live and trade and share in a global economy. And the effects of what is happening in the U.S., Britain, etc. have not started here yet to any great extent.
  4. Dr Demento from Canada writes: Thanks to the neocons running the USA - it's the end of the world as we know it . . .
  5. Wilma De Bruyn from Toronto, Canada writes: Banking system sound, deposits protected, Paulson says.

    Ha,ha,ha,ha,ha, Just like Canada eh??If if the banks screw the public,
    no problem, just change the legislation at the Privy Council level, bingo and no more deposit guarantees. Even it is, it's like pulling teeth, hardly ever happens.
    As for Canada, that's exactly what happened in the Victoria legislature under Gordo and his cronies watch. The Act is called, "Unclaimed Property Act" which is actually Seniors pensions or
    appears maybe properties as well-gone on since 1982. The Public
    Trustee should be the watch dog for inheritances, but Gordo dropped
    $3,million into this Act to cover up the scandal. True story.
    And as for our currency, no wonder it's called Loonie Toonies, and
    Donald Duck is in the Corporate us of a.
    Don't hold your breath over this deceitful bit of news folks!!!
  6. Alfons Materna from Canada writes: "Nothing is true until it has been officially denied"
    I don't feel reassured.
  7. - Nostradamus from Halifax, Canada writes: The banking system is sound because the taxpayer will bail it out if need be. Socialism, where taxpayers absorb corporate losses and bail out failed enterprises, is what makes American capitalism possible.
  8. scott thomas from Canada writes: We live and trade and share in a global economy, true, but eighty percent of that is the US, so for better or for worse, a rough time for them is a rough time for us. Medium term, one might look at the Norwegian solution, which has a similar asymmetrical relationship to the EU. Since the early 90s, when Norway (much of Scandinavia, actually) had severe economic bubbles bursts, Norway has floated above the EU, largely on oil revenues. Canada has oil and a lot more. Problem is Harpo is tied much too tightly to the Americans and their political-economic model and that Flighty has not got anywhere near the skill set to manage the change.
  9. Blue Noser from Halifax, Canada writes: Deer in the headlights photo, says it all
  10. martha stewart from Canada writes: Mark Holman writes: "Oxymoron. Sound banking system, but more trouble ahead. Well, if you don't know what it is, then your not very smart or lying to the world."

    Paulson is very smart.
  11. bill k from Canada writes: "Treasury Secretary seeks to reassure anxious public during media appearances Sunday"

    WOW the situation in the US must be worse then anyone in the world can imagine. Anyone holding USD are either insane or simply stupid. If I was in the US i would of made a run on the bank a long time ago. The fact these clowns come out a reassure the public goes to show just how desperate and scared the PPT has become. The US is bankrupted and the USD is worthless.
  12. Matt Stiles from Vancouver, Canada writes: Yes, believe the guy who didn't identify the housing bubble. Believe the guy who confidently proclaimed that subprime losses would not spread. Believe the guy who has said all along that the US financial system is fundamentaly sound. Believe the guy whose job it has been for the past two years to pursue a "strong dollar policy".

    Yeah, Hank, the banking system is sound. We believe you.

    Anyone with half a brain should take their cue from Paulson, go directly to their bank and withdraw all their funds. Runs on the banks have only just begun. Loan loss reserves are miniscule and the FDIC insures a tiny 53 Billion of the rest (about 1.5% of total deposits). Basically, the first 10% to get their money out will be the only 10% to get their money out.
  13. Silver Standard (Used to be gold) from Canada writes: - Nostradamus from Halifax, Canada writes: The banking system is sound because the taxpayer will bail it out if need be. Socialism, where taxpayers absorb corporate losses and bail out failed enterprises, is what makes American capitalism possible. ((Thats right, and its coming to an end. Paper money where banks charge the government interest and it continually loses value is the epitomy of socialism. It allows the Warfare/welfare state we have today...not to mention mass fraud and corruption as we are really about to see the results of)) bill k from Canada writes: "Treasury Secretary seeks to reassure anxious public during media appearances Sunday" WOW the situation in the US must be worse then anyone in the world can imagine. Anyone holding USD are either insane or simply stupid. If I was in the US i would of made a run on the bank a long time ago. The fact these clowns come out a reassure the public goes to show just how desperate and scared the PPT has become. The US is bankrupted and the USD is worthless. ((Its VERY bad, but there are those on this site who will tell you to invest in the dollar "while its down". LOL. We are in loads of trouble and people REALLY can't imagine too. This is going to be worst than the Depression))
  14. Silver Standard (Used to be gold) from Canada writes: We the crap finally hits the fan remember who told you everything was ok and who is responsible. ITS THE FED, THE GOVERNMENT and a PLAN to cause this. You have to realize they made every textbook bad move they could for years. You can't think that these people didn't know their action would not lead to this?

    If we crash we need to get rid of these guys and go back to REAL money that is not controlled by the government or central COMMUNIST bankers.
  15. MD Kachmar from Bubbleville, Canada writes: Paulson is a clever man. Too bad he didn't preface his comments with a definition what "sound" means. If sound means America's banking system will see dozens and dozens of banks fail over the next two years, then he is absolutely correct.
  16. If I had a million lobsters from Halifax, Canada writes: The interesting piece i believe is that he has to say this at all. This is an indication of the seriousness of the situation and the fact that people are beginning to question the soundness of the system. Clearly there is a problem if he has to say something. Remember this is the guy who said that sub prime was irrelevant. ummmm........
  17. Stude Ham from Canada writes: more claptrap to minmize the very realistic picture of the US economy recently painted by Bernanke just at about the same time Bush also used the airwaves to contradict that picture.

    this is damage control at its absolutely worst because people are noticing the very unstable state of their lifetime investments.
  18. Bryan Waterloo from Canada writes: Silver Standard (Used to be gold) from Canada writes - Just wanted your thoughts on this speech from Ben Bernanke. It links the gold standard to the great depression and a panic in the banking system (sound familar).

    The fact that, under the gold standard, the value of each currency was fixed in terms of gold implied that the rate of exchange between any two currencies within the gold standard system was likewise fixed. As with any system of fixed exchange rates, the gold standard was subject to speculative attack if investors doubted the ability of a country to maintain the value of its currency at the legally specified parity. In September 1931, following a period of financial upheaval in Europe that created concerns about British investments on the Continent, speculators attacked the British pound, presenting pounds to the Bank of England and demanding gold in return. Faced with the heavy demands of speculators for gold and a widespread loss of confidence in the pound, the Bank of England quickly depleted its gold reserves. Unable to continue supporting the pound at its official value, Great Britain was forced to leave the gold standard, allowing the pound to float freely, its value determined by market forces.
  19. Bryan Waterloo from Canada writes: continued

    With the collapse of the pound, speculators turned their attention to the U.S. dollar, which (given the economic difficulties the United States was experiencing in the fall of 1931) looked to many to be the next currency in line for devaluation. Central banks as well as private investors converted a substantial quantity of dollar assets to gold in September and October of 1931, reducing the Federal Reserve's gold reserves. The speculative attack on the dollar also helped to create a panic in the U.S. banking system. Fearing imminent devaluation of the dollar, many foreign and domestic depositors withdrew their funds from U.S. banks in order to convert them into gold or other assets. The worsening economic situation also made depositors increasingly distrustful of banks as a place to keep their savings. During this period, deposit insurance was virtually nonexistent, so that the failure of a bank might cause depositors to lose all or most of their savings. Thus, depositors who feared that a bank might fail rushed to withdraw their funds. Banking panics, if severe enough, could become self-confirming prophecies. During the 1930s, thousands of U.S. banks experienced runs by depositors and subsequently failed.
  20. Don Portz from Trochu AB, Canada writes: There is an old adage to which I subscribe and that is; Depression/Recession is 20% Financial and 80% phisoclogical.
    Based on the above posters we are in for a hellva downturn.
    So many of the above posters are so much smarter than those that were hired for the job, why have you not applied to take it over? Surely you would have no problem covincing them that you are more qualified.
  21. If I had a million lobsters from Halifax, Canada writes: Don Portz from Trochu AB, Canada writes: Based on the above posters we are in for a helluva downturn.
    So many of the above posters are so much smarter than those that were hired for the job, why have you not applied to take it over? Surely you would have no problem convincing them that you are more qualified.

    Don i don't believe people think they are smarter than Paulson and Greenspan. These guys were smart enough to lower interest rates to the point of no return, and people felt the need the to turn there houses into ATM's and spent every dime they had.

    Is that P & G's fault no not really. the suckers who bought into the 400K houses and other trappings on credit are the true suckers. But that still doesn't exonerate P&G, they had responsibility for keeping rates too low when they knew what the outcome would be.

    Are we smarter than them Don no probably not.
  22. If I had a million lobsters from Halifax, Canada writes: Oh Don one more thing, you are right about the downturn. the spiral has begun, and it will feed on itself. You know what that is great because this system is broken and needs to be cleaned up. Maybe you could solve the problem for us since you seem to have it over us little people.
  23. Alastair james Berry from NANAIMO BC, Canada writes: God bless my soul...................The U.S. banking system sound ?....... It's like a house of cards just waiting to fall...........AS LONG AS THE PUBLIC BELIEVED THAT PAPER DOLLARS HAD VALUE, THE USA GOVERNMENT COULD PRINT JUST AS MANY AS IT WANTED AND THE PUBLIC WOULD NOT NOTICE AND COULD BE "SCREWED" (and financially abused) INDEFINITELY. The Problem for the U.S. Fed is that the world, who viewed the YANKEE DOLLAR as a safe and indeed the best reserve currency, have found that they have been ROYALLY SCREWED TOO! The YANKEE DOLLAR HAS NO "INTRINSIC" Value except the scrap of paper it is printed on!................All over the world people are waking up to this fact!!............ and all hell has been let loose! The Bk of Canada's Governor,Carney with a nod from HARPER, has been printing loonies and giving credit ON ZERO INTEREST where it should not even be considered, particularly in Quebec and Ontario to silence the constant whining of CHAREST and Mc GUINTY that the loonie is "too strong"(and I'm supposed to pay 25% on my Credit Card balance) The GOLD STANDARD WILL RETURN BUT MANY BANKS WILL FAIL AND MANY GOVERNMENTS TOO, BEFORE THIS HAPPENS,
  24. ed ncda from Calgary, Canada writes: Headline says: "Banking system sound, deposits protected, Paulson says."
    if the Canadian media powers-that-be believe it's imperative to translate US $ amounts into C$ in every single wire story, and miles into kms, and color to colour, why is it not at least as relevant to preface a cut-and-paste story from AP with a headline suited for the Globe's main audience such as: "U.S. Treasury Secretary says American banking system sound, Americans deposits protected"? If the G&M's perspective is so casual what does that say about the actual contents of their beloved "Canada's National Newspaper?"
  25. jimmie rabbit from toronto, Canada writes: the sad thing is a lot of the people running these financial institutions deserve to be in jail; instead they're sitting with their ill-earned profits and the rest of us are charged with cleaning it up (that is ALL of us because we are the ones who pay the taxes to bail out the big guys, but GOD HELP YOU if you fall behind on your mortgage...)
  26. Tax me! I'm Canadian. I'll roll over! from Canada writes: :
    Hello Folks,

    I just wanted to raise awareness here. There is a movie coming out, due to be released in August entitled "I.O.U.S.A".

    It is about the impending US bankruptcy, produced by Pete Peterson, cofounder of the Blackstone Group:

    July 11 (Bloomberg) -- Blackstone Group LP co-founder Peter G. Peterson celebrated the launch of his $1 billion foundation last night by showing off his latest acquisition: a documentary that examines the perils of the U.S.'s debt.

    As he stood a few feet from a portrait of himself at the Council of Foreign Relations in Manhattan -- he's a former chairman -- Peterson, 82, addressed an elite crowd of 150 that included philanthropists David Rockefeller and Donald B. Marron; former U.S. Secretary of State Henry Kissinger; former New York Governor Mario Cuomo; Quadrangle Group LLC co-founder Steven Rattner and Robert Rubin, the former U.S. treasury secretary.

    These are all CFR members, precisely the same people who are engineering the US collapse.

    The movie exposes a message that should be heard, but they are not releasing it for the benefit of raising awareness about America's spine crushing debt, although it is important to hear this message.

    This movie is analogous to Gore's an "Inconvenient Truth".

    What they are doing is to create a false opposition. These people releasing the film CAUSED the problem and are looking to hijack the solution, probably with some sort of New World Order agenda.

    The solution is to destroy the Statists, but you will see the mainstream media cover it and there will be a great deal of propaganda stating what the Statist's solutions will be to solve the problem - with more Statist government. Beware of this.

    Here is the trailer: http://www.youtube.com/watch?v=HBo2xQIWHiM

    These people do not produce a movie like this without a self serving agenda.
  27. Tax me! I'm Canadian. I'll roll over! from Canada writes: :
    BTW, you can look at the news release here:

    http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aSi411UWhgkg

    Cheers!
  28. The Skipper from Canada writes: This is a joke, isn't it ?
  29. jim corrigan from Toronto, writes: I wonder how all those people who lined up at Indymac Bank branches across California felt, in a state of total panic, to take all their money out from their insolvent bank. I doubt they would agree with Mr Paulson or his peers.
  30. David Simon from Canada writes: If anyone doubted that this is the time to buy US banks, all these comments here should remove them.

    Buy on fear (and apocalyptic comments). Sell on greed.
  31. Silver Standard (Used to be gold) from Canada writes: Bryan Waterloo

    People are trying to hide from the dollar, thats why they buy gold and silver. You paint the "speculators" as if they were some sort of group with a yearly meeting and a Christmas dinner. People invest how they are going to invest.

    As for Bernake's speech? Is there anywhere I can see it? I will try to look.
  32. Silver Standard (Used to be gold) from Canada writes: David Simon from Canada writes: If anyone doubted that this is the time to buy US banks, all these comments here should remove them. Buy on fear (and apocalyptic comments). Sell on greed. __________________ There are not apocalyptic comments anymore. Its happening, the dollar IS crashing, they DID create too much debt money. I would not be buying any banks if I were you but go right ahead if you feel lucky.
  33. Silver Standard (Used to be gold) from Canada writes: THEY are not I mean:)
  34. Alastair james Berry from NANAIMO BC, Canada writes: " Sing us another one, Just like the other one,
    Sing us another one, DO...."

    If you live in "CLOUD CUCKOO LAND" you may believe everything you are told by those in authority but I am older and I have seen my self abused time and time again by soothing words issued from Governments attempting to cover the failures caused by their own ineptitude!

    Show me a politician or a senior government servant WHO DOES NOT PARROT THE OFFICIAL LINE and I WILL DECLARE HIM A SAINT!!......................WHO WILL BE MARTYRED ON THE CROSS, BLACKGUARDED AND FIRED FROM HIS JOB PRONTO !!

    -------------------------------------------------------------------------------------

    SO WHY AM I MAD? .........OTTAWA HAS STOLEN,PURLOINED and FILCHED 98% OF THE PURCHASING POWER OF MY 1960'S RETIREMENT SAVINGS!!

    My saved Can $ 1's are now barely worth the paper they are printed on!

    Never ever believe anything that issues from a Central Government or it's agencies.

  35. joy goodluck from barwick, Canada writes: Now to figure out which piggy banks are made out of bricks, sticks or straw. Which huff & puff is going to make them fumble & fall apart?

  36. doctor business from Vancouver, Canada writes: Wow, the only reason for an announcement like this is fear of panic - panic in the market could sink the whole ship. We are floating on a sea of faith in the money supply.

    What are these "fundamental" that are so strong? Autos that are obsolete? Computers made of rare metals that are getting harder to aquire based on a model of permanent exponential growth that is finally running up against heat limits and the like... Advertising? Movie industry? War industry? Housing? What is the fundamental that is stable here? Resources and the environment?

    That IOUSA movie in interesting. Just in time for a Democratic President to have another right wing freak out about the debt - just like in the 1990s austerity measures. So we can't have any of the social programs we need (healthcare, environment, childcare) because we all have to tighten our belts and pay to keep bankers stable? Keep the war going and never let the banking system down?

    What a strange time to live in. The real fundamentals are in our new consciousness about the environment. That kind of thing can pay off big - save money by not wasting so much! Employ hundreds of healthy bike messengers and stop with all the truck driving. And the real technology of the internet - simply being connected and communicating with each other more. Free software makes the internet revolutionary. Proprietary BS makes cell phones into perpetually disposable and obsolete status items. Our fundamentals are knowledge and our debt is stupid ignorance. Will our wealth win out? Or will we blow it on a stupid bank bailout. We need to save for the REAL environmental bailout that will actually benefit us all - not just a few.
  37. Bob Macdonald from Liverpool, United Kingdom writes: Smart Americans have been defending their wealth by getting out of US dollars. Get Euros, Swiss Francs, buy gold, buy silver. As Soros says, we are entering an epic period of wealth DESTRUCTION. It won't be about making wealth, just defending it. Hanging on to it. That will be the greatest challenge.

    Who or what will destroy your wealth? Deflating house values for one (that means property goes down). US dollar cash becomes worthless. Governments become predatory, looking for tax money wherever they can find it. Hyperinflation of commodities makes daily living very expensive.
  38. m. r. from Canada writes: when GWB and his "aids"(pardon the pun) leave office they will leave a mess of monumental proportions unseen in USA history before.
    it will never be repaired as before. another crisis is in the making.
    Obama and McCain, in my opinion, are poor choices to lead the still mighty but troubled USA. where are the JFK-types when you need them? the situation unfolding reads like "the decline of the Roman empire". as for predictions by politicians, economists and weather-forcasters......
  39. Bryan . from Canada writes: The Artist Formerly Known as Gold Standard

    Here is the link to the Speech. He is using the views of Friedman in the Speech. I only recalled the connection as it was detailed in the biography of JP Morgan Sr. that I read.

    http://www.federalreserve.gov/boarddocs/speeches/2004/200403022/default.htm
  40. Silver Standard (Used to be gold) from Canada writes: Bryan . from Canada writes: The Artist Formerly Known as Gold Standard

    Here is the link to the Speech. He is using the views of Friedman in the Speech. I only recalled the connection as it was detailed in the biography of JP Morgan Sr. that I read.

    http://www.federalreserve.gov/boarddocs/speeches/2004/200403022/default.htm

    ((Thanks, I will read it when I get home.))
  41. Ron Paul from Ottawa, Canada writes: Glad to see nobody is believing this crap. Here is a rule of thumb: whenever any govt official makes a press release and says people should not be worried, everything is ok, that means everything is going to the toilet. If the govt says that X bank is not going to fail and people's deposits are safe, it means you should get your money out as soon as possible.///

    For Tax me! I'm Canadian. I'll roll over!: Interesting movie that I will definitely watch. From what you're describing I think you're absolutely correct that this is being geared up like An Inconvenient Truth. That movie was to trick people about the manmade climate change crap and this movie will be to shock people on how bad the economic situation is and that the holy govt is the only entity that will save us all from financial doom. Just the fact that it was presented infront of CFR members such as Rockefeller and Kissinger says it all. There is no way the Elite will let a movie like this be shown if it didn't serve their interests. Gosh, these people are getting so predictable now that's it's almost funny.///

    For Silver Standard and Bryan: Perhaps I can comment on that speech from Bernanke. Bernanke was hired as the Fed Chairman because of his deep research into The Great Depression. He did his PhD thesis on that. Anyway, his main thesis was that it was the lack of liquidity that caused the 1929/1930 recession to turn into a Depression and then a Great Depression that lasted for about 10 years. However, his analysis was narrow and flawed. While he was correct that it was a lack of liquidity that made the whole thing worse, that is too simple of an analysis. What he fails to mention is that it was lax monetary policy during the 20's (that's why it was called Roaring 20's) that made the conditions right for a recession at the end of that decade. During the 1920's, the newly created Fed lowered interest rates, made credit really cheap, and printed a lot of money.

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