Resolutions (FDIC) allowing Cypress style 'bail in' for US Banks (or subs) aftr shareholdr

[sailingaway]

only after shareholders lose value which sounds significantly better until you notice how much the Fed and intercompany transfers could create the 'loseable' units separate from the 'good' units to begin with.


Editor note: Bringing this massive story back to the top of the news feed for those who missed it over the holiday weekend.
On Wednesday, SD broke the news that Canada had buried a provision for depositor bail-ins for systemically important banks deep inside its official 2013 budget, and stated that the Cypriot bail-in was not just a one-off event, but is in fact the new collapse template for the entire Western banking system.
We suspected that the same policy change had been made by the US & the UK, but was simply yet to be discovered, buried in the website of a Federal agency.

We suspected correctly…

In the introduction, the resolution informs readers that the FDIC and the Bank of England have been working together to formulate the new bail-in model for future bank failures:


The Federal Deposit Insurance Corporation (FDIC) and the Bank of England—together with the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, and the Financial Services Authority— have been working to develop resolution strategies for the failure of globally active, systemically important, financial institutions (SIFIs or G-SIFIs) with significant operations on both sides of the Atlantic.
The goal is to produce resolution strategies that could be implemented for the failure of one or more of the largest financial institutions with extensive activities in our respective jurisdictions. These resolution strategies should maintain systemically important operations and contain threats to financial stability. They should also assign losses to shareholders and unsecured creditors in the group, thereby avoiding the need for a bailout by taxpayers.

The joint US/UK resolution states that depositor haircuts are already legal in the UK thanks to the 2009 UK Banking Act:


In the U.K., the strategy has been developed on the basis of the powers provided by the U.K. Banking Act 2009 and in anticipation of the further powers that will be provided by the European Union Recovery and Resolution Directive and the domestic reforms that implement the recommendations of the U.K. Independent Commission on Banking. Such a strategy would involve the bail-in (write-down or conversion) of creditors at the top of the group in order to restore the whole group to solvency.

And that the legal authority has already been given in the US buried in Dodd-Frank:


It should be stressed that the application of such a strategy can be achieved only within a legislative framework that provides authorities with key resolution powers. The FSB Key Attributes have established a crucial framework for the implementation of an effective set of resolution powers and practices into national regimes. In the U.S., these powers had already become available under the Dodd-Frank Act. In the U.K., the additional powers needed to enhance the existing resolution framework established under the Banking Act 2009(the Banking Act) are expected to be fully provided by the European Commission’s proposals for a European Union Recovery and Resolution Directive (RRD) and through the domestic reforms that implement the recommendations of the U.K. Independent Commission on Banking (ICB), enhancing the existing
resolution framework established under the Banking Act.
The development of effective resolution strategies is being carried out in anticipation of such legislation.

The unsecured debt holders can expect that their claims would be written down to reflect any losses that shareholders cannot cover, with some converted partly into equity in order to provide sufficient capital to return the sound businesses of the G-SIFI to private sector operation. Sound subsidiaries (domestic and foreign) would be kept open and operating, thereby limiting contagion effects and cross-border complications. In both countries, whether during execution of the resolution or thereafter, restructuring measures may be taken, especially in the parts of the business causing the distress, including shrinking those businesses, breaking them into smaller entities, and/or liquidating or closing certain operations.


The resolution states that while the US would prefer large financial institutions be resolved through ordinary bankruptcy, depositor wealth confiscation will be pursued in the case of a systemically important institution (i.e. BOA, JPMorgan, Goldman Sachs, etc):

As demonstrated by the Title I requirement of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act), the U.S. would prefer that large

financial organizations be resolvable through ordinary bankruptcy. However, the U.S. bankruptcy process may not be able to handle the failure of a systemic financial institution without significant disruption to the financial system.

The resolution authority states that shareholders would lose all value prior to depositor scalpings:


Under the strategies currently being developed by the U.S. and the U.K., the resolution authority could intervene at the top of the group. Culpable senior management of the parent and operating businesses would be removed, and losses would be apportioned to shareholders and unsecured creditors. In all likelihood, shareholders would lose all value and unsecured creditors should thus expect that their claims would be written down to reflect any losses that shareholders did not cover.

Under both the U.S. and U.K. approaches, legal safeguards ensure that creditors recover no less than they would under insolvency.

The banksters plans for a bail-in resolution agency include investment banks and clearing houses as well as deposit bearing institutions!!!

[here the article gets confusing as to whether it is quoting UK or US law and it is at the link]

This is a hard money site (silver) so clearly they have a take on it, but I thought it was worth posting. If people here know more about this, maybe you could chime in...

http://silverdoctors.com/fdic-bank-of-england-create-resolution-authority-for-unlimited-cyprus-style-bail-ins-for-tbtf-banks/

[Bern]

Yeah, my comment is buried at the bottom of the page, but I did find the source they are quoting. You can find it here:

http://www.bankofengland.co.uk/publications/Documents/news/2012/nr156.pdf

It's from December last year. This "Cyprus solution" was apparently planned and globally coordinated some time ago.

[HOLLYWOOD]

We knew and pointed out years ago that Dood-Frank Banking Act gave a backdoor bailout to the banks again.

The Lab experiment was Cyprus to see exactly what the serfs would do when the government steals from them (depositors) and gives it to the international banksters.

Most Americans don't realize, the US taxpayers are still paying for the S&L Bailout(s) fraud collapse of the 80s/90s, that's in addition to all the debt stuck to American taxpayers by Sheila Bair/FDIC over the past 5 years. It will ALWAYS be the American savers, depositor, taxpayers, that are the final backstop to bailing out Banks and the fraud/waste/abuse of their partners in government.

I'll leave yah with this US Senate prostitute's comments about banks:


http://www.youtube.com/watch?v=CZbC_IqWEJY

[Lucille]

We'll know that Americans have finally gotten their heads out when the bank runs start.

http://armstrongeconomics.com/2013/03/29/cyprus-confiscation-of-assets-is-global-plan/


There is little hope of reversing the trend at this point and everyone should know that this confiscation of assets was NOT something out of the blue. This was seen as the alternative to “taxpayer” bailouts following the meltdown of 2008-2009. The bankers scared the hell out of government warning they would collapse if the big bankers failed for nobody would be there to sell their debt...

We will publish a report on this, but effectively this was discussed at the G20 meeting and this has been put in written documents around the world. It is the next step in the Sovereign Debt Crisis that EVERY country has followed. This is the VERY SAME measure that was done in M.F. Global. The court refused to hold the banks responsible and thus the losses from the firm’s illegal trading were taken from client accounts.
[...]
There is no crazy scheme to stimulate anything. This is about protecting the banks initially (namely NYC) but is all about protecting the halls of government. The real problem; this was NOT done to protect the Cypriot banks. This was done to save the European Commission. They got away with this with M.F. Global. They are now trying it out on Cyprus. This is in the desk drawers of all major central banks as the way to do this. They are getting away with this just as Maximinus I (235-238AD) and all wealth at all times belongs to the state. By the way, when you deposit money in the bank, it is actually no longer legally yours. You become an UNSECURED creditor of the bank. Nothing more.

Yes, MF Global was the Direct Antecedent to Cyprus
http://barnhardt.biz/


Cyprus is MF Global on a national, retail banking scale. Corzine absolutely blazed this trail. The particulars are almost exactly the same. Both MF Global/Corzine and Cyprus were failing entities, both took massive, uber-leveraged risks on European sovereign debt, both swept sacrosanct customer money when the house of cards finally collapsed under the weight of its own math.

The indefensible zeroes and ones were instantly swept from the computer servers and customers were locked-out of their accounts.
[...]
This will happen here. It already has with MF Global, Cyprus is testing the national, retail banking level, and then it will happen here. They might go straight to bank holidays here, as Warren Pollock has been talking about for over 18 months now, or they may do a levy confiscation like this on retirement accounts.

If you have any money exposed to the financial system, you're just stupid. That's it. Bottom line.

"This opens up enormous possibilities for the Administration."
--CNBC Fascist
http://market-ticker.org/akcs-www?post=218859

"The moment the idea is admitted into society that property is not as sacred as the law of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence."
-John Adams

[sailingaway]

Yeah, we knew Dodd Frank institutionalized bailouts but not that it was globally coordinated and the general populace didn't have Cyprus as an example.

[HOLLYWOOD]

We'll know that Americans have finally gotten their heads out when the bank runs start.

http://armstrongeconomics.com/2013/03/29/cyprus-confiscation-of-assets-is-global-plan/


Yes, MF Global was the Direct Antecedent to Cyprus
http://barnhardt.biz/

"This opens up enormous possibilities for the Administration."
--CNBC Fascist
http://market-ticker.org/akcs-www?post=218859

"The moment the idea is admitted into society that property is not as sacred as the law of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence."
-John Adams


We will publish a report on this, but effectively this was discussed at the G20 meeting and this has been put in written documents around the world. It is the next step in the Sovereign Debt Crisis that EVERY country has followed. This is the VERY SAME measure that was done in M.F. Global. The court refused to hold the banks responsible and thus the losses from the firm’s illegal trading were taken from client accounts.
[...]
There is no crazy scheme to stimulate anything. This is about protecting the banks initially (namely NYC) but is all about protecting the halls of government.

Today's news out of Japan... (Mentioned the G20 and the collaborative efforts of the international bankers) BOJ' announces 2% inflation target... sound familiar FED fans? BTW, checkout the video snapshot and where the banner is stopped on the pic, 'Trans Pacific Partnership' ==> http://www3.nhk.or.jp/nhkworld/english/news/20130402_32.html


NHK Top Stories
http://www3.nhk.or.jp/nhkworld/english/news/update/images/20130402_32_v_s2.jpg (http://www3.nhk.or.jp/nhkworld/english/news/20130402_32.html) <= Read the Banner

Abe: 2% inflation target can be achieved (http://www3.nhk.or.jp/nhkworld/english/news/20130402_32.html)

Japanese Prime Minister Shinzo Abe says he believes the country's central bank will achieve its target of 2-percent inflation through aggressive monetary easing.

Abe spoke before the lower house budget committee on Tuesday.

He said Bank of Japan policymakers have expressed their determination to meet the target in about 2 years. He said that declaration by the BOJ has already been effective in weakening the yen and boosting stock prices.

Abe said the BOJ's commitment will raise inflation expectations and result in a 2 percent rise in prices.

BOJ Governor Haruhiko Kuroda told the budget committee the central bank will use all the policy tools at its disposal. He said the bank will implement bold monetary easing measures to achieve the price target as soon as possible.

But he admitted that it won't be easy to end 15 years of deflation.

Kuroda chairs his first BOJ policy board meeting as governor starting on Wednesday.

Apr. 2, 2013 - Updated 07:13 UTC

[Bern]

BOJ actually announced the 2% inflation target back in January.

[Lucille]

Savers: You’re The Bank’s Bitch
http://barelyablog.com/savers-youre-the-banks-bitch/


Lawrence E. Rafferty, guest blogger on Professor Jonathan Turley’s blog, confirms what those of us who cleave to the Austrian school of economics already know: The workings of fractional reserve banking guarantee one thing only: Your deposits are not your own.

Booster to the banks Stuart Varney, of Fox Business, stressed today that he believes with all his heart that the US Congress [the same intemperate group that has helped accrue the US government's 17 trillion dollar debt] will protect the private property of American depositors from the state-sanctioned theft suffered by Cypriot savers.

Rafferty sunders the Varney pie-in-the-sky, revealing that,


“A joint paper by the US Federal Deposit Insurance Corporation and the Bank of England dated December 10, 2012, shows that these plans have been long in the making; that they originated with the G20 Financial Stability Board in Basel, Switzerland (discussed earlier here); and that the result will be to deliver clear title to the banks of depositor funds. ” ...

The above article explains that most of us do not realize that when you deposit money in a bank, that it becomes the property of the bank and we become unsecured creditors of the bank! “Although few depositors realize it, legally the bank owns the depositor’s funds as soon as they are put in the bank. Our money becomes the bank’s, and we become unsecured creditors holding IOUs or promises to pay. (See here and here.) But until now the bank has been obligated to pay the money back on demand in the form of cash. Under the FDIC-BOE plan, our IOUs will be converted into “bank equity.” The bank will get the money and we will get stock in the bank. With any luck we may be able to sell the stock to someone else, but when and at what price?” ...

If I deposit $1,000 dollars in my local bank, I trust that the funds are safe and protected by FDIC insurance and that even if the bank fails, I will get my money back. Under the plan listed above, we may not even be able to fall back on the FDIC insurance coverage. The FDIC-Bank of England plan would supersede our FDIC coverage and we would be relegated to become a “shareholder” in the failing bank or its successor entity. Let me see if I understand this scheme. The bank who is failing due to mismanagement or due to risky investments could steal my funds and force me to accept stock in a company led by poor businessmen with an even poorer business record! If you are brave enough, check out the full FDIC-Bank of England plan here.

Cyprus wasn’t the only place where a bankster grab of deposits was put into place or is being discussed. It is being discussed in New Zealand as well. “New Zealand has a similar directive, discussed in my last article here, indicating that this isn’t just an emergency measure for troubled Eurozone countries. New Zealand’s Voxy reported on March 19th:

Read Rafferty’s complete report. (http://jonathanturley.org/2013/03/31/could-the-banksters-grab-your-bank-deposits/)

Yippee! For your “hard earned deposits,” you’ll receive shares in a bankrupt, banking institution.

As Lew Rockwell put it recently, the most patriotic thing one can do is to partake in a run on the bank.

Before the fact, of course.

Moreover, and as I’ve long argued, thanks in no small part to Congress, various global agreements, mediated by a global bureaucracy—these embroil individual Americans absent their consent—have usurped the US Constitution and the power of Congress.

International treaties are often nothing more treason tarted up.

[ClydeCoulter]

"If you have any money exposed to the financial system, you're just stupid. That's it. Bottom line."

So, what would Barnhardt have people do who have IRA's, 401k's, retirement savings, etc...?

Take out your retirement before 59.5 years of age and you get a 10% haircut + pay taxes on it all at once in a higher tax bracket.

I have 14 months before I'm 59.5. This makes me, somewhat, nervous.

[Anti Federalist]

"Haircut"...is that what they are calling armed robbery these days?

I wonder what would happen to me if I decided to walk into the local liquor store and give them a "haircut".

Well, I guess I can see this, after all...you didn't build that.

[Bern]

...
So, what would Barnhardt have people do who have IRA's, 401k's, retirement savings, etc...?
...

Ann is pretty hard core. Pretty sure she advised folks to bail on the system when MF Global went down and she shut down her trading business.

[ClydeCoulter]

Ann is pretty hard core. Pretty sure she advised folks to bail on the system when MF Global went down and she shut down her trading business.

Unfortunately, I didn't get access to my pension to cash out into an IRA until recently. I had planned on cashing out part of the IRA to pay off my construction loan after I turn 59.5, but now I'm considering taking that "haircut" of 10% now instead of maybe a larger one before I turn 59.5.

Yea, AF, they are calling it a "haircut", guess they think it's just dead stuff you have hanging around that they can take off your hands. No biggie, right? Fuck That!

[sailingaway]

https://pbs.twimg.com/media/BG4evhxCYAE2Iyr.jpg:large

[MRK]

"Haircut"...is that what they are calling armed robbery these days?

I wonder what would happen to me if I decided to walk into the local liquor store and give them a "haircut".

Well, I guess I can see this, after all...you didn't build that.

http://thumbs2.ebaystatic.com/d/l225/m/mjm_XCnKBbBZJtOtwgKsb7A.jpg

[Lucille]

"Haircut"...is that what they are calling armed robbery these days?

I wonder what would happen to me if I decided to walk into the local liquor store and give them a "haircut".

Well, I guess I can see this, after all...you didn't build that.


Unfortunately, I didn't get access to my pension to cash out into an IRA until recently. I had planned on cashing out part of the IRA to pay off my construction loan after I turn 59.5, but now I'm considering taking that "haircut" of 10% now instead of maybe a larger one before I turn 59.5.

Yea, AF, they are calling it a "haircut", guess they think it's just dead stuff you have hanging around that they can take off your hands. No biggie, right? Fuck That!

It's a metaphor fail since hair grows back! Bail-outs, bail-ins, haircuts, Too Big To Fail, Too Big To Jail...it makes me want to run screaming into the streets!

Are All G20 Bank Depositors Exposed to a Cyprus Style Seizure of Deposits for a 'Bail-in?'
http://jessescrossroadscafe.blogspot.com/2013/04/are-all-g20-bank-depositors-exposed-to.html


I do not wish to seem to be an alarmist, but this additional information and some of the other events which are occurring has created a rather significant shift in my thinking. Cash is not cash and deposits are no longer deposits as we once thought of them in this non-transparent, post-Glass Steagall financial world of ours.

Congratulations. You may now be an unsecured creditor of your local TBTF bank if your and yours have any money on deposit there, either directly or indirectly. You say you have money in a pension fund and an IRA at XYZ bank? Oops, it is really on deposit in you-know-who's bank. You say you have money in a brokerage account? Oops, it is really being held overnight in their TBTF bank. Remember MF Global?

Who can say how far the entanglements go? The current financial system and market structure is crazy with hidden risk, insider dealings, control frauds, and subtle dangers. Jim Chanos says that the cheating is so widespread and unpunished that it becomes almost a fiduciary responsibility to break the rules.

No wonder people are so edgy. I think the plutocrats have gone too far, but are so detached and out of touch that they have not figured it out yet. And when the awaking comes, it will be quite a surprise to many.

To my correspondents who say they have spoken to their elected representatives about this and received assurances, I would not assume that they are aware of this international agreement which the US has presumably signed. I was not.

And if you think they will stand up against any plans to take your deposits during a banking emergency, against a vociferous and overwhelming flood of objections from their constituents, remember how quickly the Congress caved on TARP and Cyprus' Parliament gave way to the EU and ECB.

Welcome to the abyss.

Cyprus Is Not So Much An Anomaly as the Template For the Next Financial Crisis
http://jessescrossroadscafe.blogspot.com/2013/04/cyprus-is-not-so-much-anomaly-as.html


This is not so much anything new, but a concrete reminder of the breadth of systemic banking risks inherent in the Anglo-American banking structure in which depositor money is intermingled with the Bank's speculative interests.

The repeal of Glass-Steagall stripped the average person of important and time-tested safeguards against loss. Things are different now.

Any deposits you have at a bank in excess of 'insurance guarantees' are at risk in case of another financial crisis.

This exposure may include wealth you think that you own, but do not know exactly where and how it is being held. This may include 401k's and IRA's, pension plans, health insurance deposits, life insurance and annuities, and so forth.

MF Global was very instructive on how even cash deposits and physical assets backed by a certificate of ownership may be fair game for the banking system in the event of a crisis.

Nothing is perfect and foolproof, but there are degrees of safety.

http://www.theburningplatform.com/?p=52071


“The financial system is inherently unstable now, and I would take defensive measures as one might be able. When the time comes, there will not be time.” – Jesse

I don’t think Jesse could be any clearer. He hasn’t been this worried since I’ve been reading his daily musings. His concern matches Hussman’s, Denninger’s, Shedlock’s, and a few other people I trust. I bought some silver today when it dropped below $27 per ounce. Defensive measures are necessary. Cash in your possession and physical possession of silver and gold are highly recommended at this time. The politicians and bankers are preparing for the tsunami that is going to hit our shoreline. They are perfectly happy to leave you on the beach. They will not be sounding the alarm. You are on your own.

[Lucille]

All Gov’ts Acknowledged The Cyprus Model for Bank Bailouts Is It
http://armstrongeconomics.com/2013/04/03/all-govts-acknowledged-the-cyprus-model-for-bank-bailouts-is-it/


With the evolution of time, what began as a fraud of lending out depositor’s money had been consistently carried out so the crime became simply the way to do business. Today, this has evolved one step further. Banks are no longer satisfied lending your money to someone else, which has been justified as financing the economy and creating more jobs. Today, they just use your money to speculate – heads they win – tails you lose.
[...]
http://armstrongeconomics.files.wordpress.com/2012/08/ecm-wave-2011-2020.jpg?w=584&h=452

We are on the edge of destroying Western Civilization. When the economy turns down from 2015.75, this time instead of them cutting a check for $700 billion to the bankers, they will give them their blessing to just take your money outright. This is checkmate – the M.F. Global/Cyprus solution.

The Grand Facade of civilization so soon will burn. We are without a voice. The press is no longer free and has been bought off, the courts are hopeless, and we are without representatives in government. Instead of listening, they prepare to take the right to defend away from the people under the pretense of making the streets safe when the criminals do not go to stores to buy anything. They prefer to buy enough illegal bullets to shoot every citizen 5 times and plow down the streets with tanks. All of this rather than reform. They never plan beyond the next step. Just what the hell do they think they are doing? Is this a world they want for their own children or are they just blind to their instant greed?

[Zippyjuan]

Two other options. One- citizens pay for the bank bailout with tax money. Two- the bank is allowed to close up and all depositors lose 100% of their money. In this case, they decided not to use taxpayers and use some instead of all of the depositors money to pay for the loan. Not saying which of the three options would have been the most desirable.

[Anti Federalist]

Two other options. One- citizens pay for the bank bailout with tax money. Two- the bank is allowed to close up and all depositors lose 100% of their money. In this case, they decided not to use taxpayers and use some instead of all of the depositors money to pay for the loan. Not saying which of the three options would have been the most desirable.

Option Four:

Everybody "un-bank" and use sound money for transactions.

Oh, yeah, that's right, I forgot.

Not having a bank account is terrorism.

[Lucille]

Two other options. One- citizens pay for the bank bailout with tax money. Two- the bank is allowed to close up and all depositors lose 100% of their money. In this case, they decided not to use taxpayers and use some instead of all of the depositors money to pay for the loan. Not saying which of the three options would have been the most desirable.

"Let justice be done though the heavens fall."

Prosecuting the banksters and their partners in crime in CONgress was, and still is, the most desirable. Bailouts, bail-ins, TARP, ZIRP, QE∞--none of it is being done for us mundanes.

As it stands, the fascist have not only undermined the rule of law, but are prolonging the depression, and exacerbating the economic pain we'll all suffer when it all comes crashing down.

And wasn't it you who said just a few weeks ago that "the worst is well past?" Wrong again.

As a reminder, here they are, post-TARP vote (http://voxday.blogspot.com/2008/09/we-did-it-suckers-bit.html):

http://www2.nationalreview.com/dest/2008/09/28/28bailout4.600.jpg

Looks like it's hella fun to rob the American people blind! No wonder they haven't stopped.

[Bern]

Two other options. One- citizens pay for the bank bailout with tax money. Two- the bank is allowed to close up and all depositors lose 100% of their money. ...

Those options suck. FDIC is supposed to be funded by solvent banks via fees. It is supposed to be insurance for bank failures (up to 250K per account). Banks that fail are supposed to go through normal bankruptcy proceedings where the management finds their ass on the street and the assets get bought/absorbed by healthy banks. There is no reason why bank depositors should be on the hook for Wall Street malfeasance, or continue to pay their multi-million dollar bonuses for gambling with their customer's deposit money.

[Lucille]

You Must Act Now
http://www.jsmineset.com/2013/04/06/you-must-act-now/


The US has already put in place bail-in-like powers as part of the Dodd-Frank financial reform act passed last year. The law includes a resolution scheme that gives regulators the ability to impose losses on bondholders while ensuring the critical parts of the bank can keep running.
[...]
I have given my all to communicating the most important conclusions concerning your future financially and therefore on every level of life.

1. The operation to depress the gold price since the high was limited in time and is now behind us in terms of maximum pain for the bulls.

2. You must exit the system immediately because the Financial Nazis struck in Cyprus and now are moving directly towards you. This is simple fact, which if you ignore will be akin to the rise of the Nazis in Germany for those that knew they should, but never made the decision to leave that system.
[...]
Government sponsored retirement tax preferential retirement programs must realize that one of the IMF plans in Cyprus was to nationalize all retirement programs. That means steal your retirement funds and assets, replacing them with some form of future paper assuming Cyprus returns to solvency.

You must, in my opinion, face whatever tax consequences there are and close your retirement programs. You are in clear and present danger of confiscation for questionable paper of whatever you hold in these type accounts. In a financial sense you are exactly what the ghettos in Germany and Poland were when they knew they should run but found any excuse possible not to do what was logically screaming at them to take action.

I am screaming at you from every pulpit I can find, with no personal benefit that you must take various actions and take them now. The fact the IMF, a major international body, had the audacity to demand that Cyprus nationalize all it pensioners and confiscate large percentages of the account values should be like a flashbulb going off in your eye to wake you from your sheeple slumber.

Bite the bullet.
Pay the tax.
Get your assets back.
Get out of the system.
[...]
You must eliminate to the greatest degree possible all the agents between you and your assets.

There is no question that leaving assets in street name with your brokers and bankers is a financial death wish. The preferred way of holding shares of stocks has always been in your own name as physical certificates. The second best method, but much better than street name, is to hold your shares in Direct Registration. Do not expect your banks, brokers or companies you are invested in to make it easy to get out of their system. They will fight you all the way, but you have to insist on your rights regardless of their refusal or false dire warning of negative circumstances when you succeed in demanding your rights. Most of it exaggerations of what is really minutia when it comes to protecting yourselves.

[TheTexan]

Two other options. One- citizens pay for the bank bailout with tax money. Two- the bank is allowed to close up and all depositors lose 100% of their money. In this case, they decided not to use taxpayers and use some instead of all of the depositors money to pay for the loan. Not saying which of the three options would have been the most desirable.

Considering that the banking system is a fraud, depositors claims would need to be paid back first in a bankruptcy. The depositors would not lose 100% in an honest bankruptcy, they may even get all their money back plus punitive damages. But that would mean the bankers would lose. Cant have that.