My bank was closed down by the FDIC on Friday. I guess I have to go looking for a new account now. That's too bad, because that was the nicest bank I've ever worked with. There was another bank failure on Friday, but my mind, for some reason, is concentrating on my bank failure. I'm not going to lose any money, but it's still a shock.
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If ye love wealth better than liberty, the tranquility of servitude than the animated contest of freedom, go from us in peace. May your chains sit lightly upon you, and may posterity forget that you were our countrymen! - Samuel Adams
Following is the text of a letter dated December 30th, 1925, reportedly from the Deutsche Bank in Berlin, Germany to Attilio Eneiui, 100 First Street, Portland, Oregon.
Dear Sir / Madam, In reply to your letter of the 26th ult. we beg to inform you of the following: By reason of the new Bank Act and the new Mint Law of August 30th, 1924, the new Reichsmark currency has been established in Germany on October 11th, 1924. The Reichsmark is the new lgal tender in this country. In accordance with the Mint Law one Reichsmark of the new currency is equal to one billion (1.000.000.000.000.000) Marks of the former currency.
With the establishment of the new Reichsmark as legal tender, we as well as the other German Bankers had to introduce the Reichsmark in our bookkeeping system. On December 31st, 1923 your account showed a balance of Papermarks 1.000.000,-- in your favor and as this amount cannot be expressed in the smallest units of the new currency a conversion into Reichsmark is impossible. The balance on your account has in fact been wiped out by the depreciation of the Mark and by part of the charges for carrying the Account since the last statement we sent you. For these reasons we must, to our great regret, inform you that we are obliged to close your old Mark Account on our books.
If at any future time your should wish us to transact for you any business in the new Reichsmark we shall be pleased to place our service at your disposal.
We are, dear Sir / Madam, Yours very truly, Deutsch Bank
Germany 1925 = Zimbabwe today. Last march, I got a ten-million Zimbabwe dollar bank note for ten bucks off eBay. Last September, I got a five-billion bank note for ten bucks. Watching the news, they've added (and lopped off by 'starting over' half a dozen more zeroes since then. Basically, no matter what that govt prints, it's toilet paper in a few months.
With a little luck, we'll be able to avoid that sort of hyperinflation. I wouldn't really be surprised to see stagflation now that Carter II is in the office though.
LM
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And I'd discuss the holy books with the learned men, seven hours every day. That would be the sweetest thing of all.
I hope that we'll avoid hyperinflation, because I've seen firsthand what it does. But the government can't keep printing money like it has if we want to avoid that. I got my money out of the bank this morning. There were two police cars there. I guess they want to avoid any unpleasantness. The credit union across the week, for about a month previous, has had ads on their sign that say stuff like "Tired of banks? Try us, we're financially stable." Now their sign says "Looking for a New Frontier? Try us." It's kind of a clever play on the name of my failed bank, and I think they're making a point. New Frontier was famous in the area for its exceptional customer service. The credit union is saying, basically, that if you're looking for the same level of service, go there. Unfortunately, I can't open a bank account anywhere yet, because I lost my social security card in my rollover accident. So I ordered a new copy of my birth certificate and will open an account when it gets here (which should be soon; I gave them an overnight mail envelope to send it with).
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If ye love wealth better than liberty, the tranquility of servitude than the animated contest of freedom, go from us in peace. May your chains sit lightly upon you, and may posterity forget that you were our countrymen! - Samuel Adams
One of our sons is in a part time business buying gold in various forms (everything from gold coins and jewelry to gold teeth) and selling it at a mark-up. It seems some people are strapped enough for cash that it has come to this. A friend of ours sold a silveware set for the silver value.
I'm not comfortable with gold as an investment because what FDR & Co. did in around 1935, OB & Co. might well try again.