The mainstream media has generally been very quiet about the massive cyber attacks against our major banks, but behind the scenes authorities are truly alarmed. They don’t know how to stop them, and they just keep getting more intense and more sophisticated. In fact, major U.S. bank websites have been offline for a total of 249 hours over the past six weeks. [Imagine if you] (like thousands upon thousands of Chase customers last month) logged into your bank account only to discover that your balance had all been reset to zero… [Here’s what to do to protect yourself.] Words: 960
So says Michael (http://theeconomiccollapseblog.com) in edited excerpts from his original post* entitled ALERT: All Of The Money In Your Bank Account Could Disappear In A Single Moment.
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Michael goes on to say in further edited excerpts:
Some are blaming Chinese hackers for these attacks while others believe that it is Iran, and yet others are convinced that it is the work of Islamic terrorists… and, in fact, it may not be hackers on the other side of the globe that are attacking our banks. Indeed, if someone wanted to “recapitalize the banks”, all they would have to do is wipe out all of our bank account records (including all backup records) and, suddenly, trillions of dollars of “unsecured liabilities” (that is what our bank accounts are) would be wiped out and the banks would suddenly be solvent again. Anyone that could not produce evidence that they actually had money in the banks would be in a lot of trouble. It would be the largest single wealth transfer in the history of the world, and it would throw the U.S. economy into utter chaos. This is a scenario that I am exploring in my new novel which will be coming out later this month.
In addition, there is the constant threat that a massive EMP [electromagnetic pulse] burst could fry all of our electronics (including the banking records), but that is a topic that I have covered in a previous article.
Another way that your bank account could be wiped out in a single moment is if the government decides to “legally” steal it. We just witnessed this happen in Cyprus….[and,] sadly, a very similar thing could easily happen in the United States someday. As I wrote about yesterday, the big banks are making incredibly reckless bets with our money. When those bets go bad, our money could very well be used to cover those bets.
One way this could be accomplished is by using a practice known as “rehypothecation”. It sounds complicated, but it really isn’t. Basically, the banks use money that clients have entrusted to them to cover their own gambling debts. This is how rehypothecaton is defined by Investopedia: “The practice by banks and brokers of using, for their own purposes, assets that have been posted as collateral by their clients.”
An excellent article by Jeff Nielson detailed how this could result in the big banks grabbing our money when their trillions of dollars of reckless bets go bad…
1) Our banking regulators knowingly allow financial institutions to engage in recklessly misleading (if not outright fraudulent) contracts with their clients, through the use of complex “small print” in their account contracts with clients.
2) The three largest U.S. “banks” by deposit (JP Morgan, Bank of America, Citigroup) have made bets in their own rigged casino, which total well in excess of $100 trillion, an amount which completely dwarfs their total, combined deposits (and assets).
3) A large portion of those bets occur in the $60+ trillion credit default swap market. Pay-outs in these markets can (and do) exceed 300 times the amount of the original bet. It is bets in this market which “blew up” AIG, requiring more than $150 billion in immediate government aid.
4) Following the Crash of ’08; these same banks mooched a package of hand-outs, tax-breaks and “guarantees” (i.e. future hand-outs) from the Bush regime in excess of $15 trillion, the last time their gambling debts went bad on them – and all of these banks have been allowed to dramatically increase the total amount of their gambling since then.
5) It would take only a minor change in the gambling contracts in which these bankers engage to allow their creditors to seize funds out of ordinary bank accounts.
6) The existing language for the bank accounts of these U.S. banks is possibly already so vague (and prejudicial to clients) that it would allow these banks to reinterpret the terms of these bank accounts – and allow rehypothecation to be used to rob the holders of ordinary bank accounts, people who themselves make no “bets” in markets whatsoever. Alternately, customers could be blitzed with an offer for “new and improved” bank accounts, where terms allowing rehypothecation are slipped into the contract, with the banks knowing that the “regulators” will do nothing to warn account-holders of the gigantic risk they are taking.
We are all covered by deposit insurance, right? That is what the people of Cyprus thought too [but], as we just saw in Cyprus, when there is a “banking crisis” sometimes government steps in and suddenly changes all of the rules overnight even though the vast majority of the population is against it.
How to Protect Yourself
No bank account will ever truly be “safe” ever again. Your money may be safe today, and your money may be there next week, but someday it could disappear in a single moment. As a result, the general public is definitely starting to lose faith in the banking system….so here’s what you should do to protect ourself:
- do not have all of your money in one bank, and
- keep paper copies of all of your bank account statements. Someday you may need those statements in order to prove that you actually had money in the bank.
Our world is becoming increasingly unstable, and at some point financial disaster is going to strike. By taking prudent precautions now, hopefully you will be able to minimize the damage to your family.
[Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.]
The funds you have placed on deposit and the property you thought was secured in your safe deposit box may not be safe under certain circumstances. They may, in fact, all end up belonging to the bank and not to you.
To believe that governments…[won’t confiscate your] gold to help support their national finances… would be naïve, especially in light of past and recent events. That’s why it is now incumbent on all investors to look at the meaning of ownership in investing and investors’ vulnerability to government confiscation as well as vulnerability to exchange and capital controls. We do this below.