As the Markets Plunge, Bernanke and Paulson Gamble Depositor’s Money

[phantom power]

As Atrios sez, Perhaps it is mattress time.

The Fed added that it was suspending a rule that normally prohibits deposit-taking banks from using deposits to help finance their investment banking subsidiaries to allow them to fund activities normally funded in the repo market on a temporary basis until January 30 2009.

http://www.ft.com/cms/s/0/136a27d8-82d0-11dd-a019-000077b07658,dwp_uuid=11f94e6e-7e94-11dd-b1af-000077b07658.html?nclick_check=1

[Historic NY]

1. I'm going to ask my bank how long it would take to....

get all my funds out in cash tomorrow....think that would shake the up. I mean they are asking JP morgan (chase) to buy out the failure.

[zeemike]

2. Why not gamble with depositors money

If they louse it the government will pay.

[hay rick]

3. Love the smell of napalm in the morning.

Sounds like they expect that no one in their right mind will provide investment banks with credit. So let the banks use unwitting depositor's funds. FDIC is ready to step in and bail out all the little guys if things really go south, right? And let me think, FDIC is funded by...think, think, think...

[CountAllVotes]

4. maybe a credit union is safer

>> Your savings federally insured to at least $100,000 and backed by the full faith and credit of the United States Government. Traditional and Roth IRAs (Individual Retirement Accounts) are insured to at least $250,000. National Credit Union Administration, a U.S. Government agency. We do business in accordance with the Federal Fair Housing Law and the Equal Credit Opportunity Act.).

Any ideas on this?

Bad plan Bernanke - lending money to known crooks isn't a great idea!

[central scrutinizer]

5. It't pitchfork and torch time - storm the castle and kill the monster

before it's too late. Before we are fighting over cardboard boxes and prime spots under the few bridges still standing as our retirement plan.

[the_real_38]

6. Oh my god - that's the Glass-Steagall act, right?

The one enacted after the depression, as FDR figured out (rightly) that it was the intertwining of interest of commercial and merchant banking that caused the 1929 meltdown?

Old sayings hold true - "may you never live in interesting times".

[grasswire]

7. yeah, this one scared me when I heard it

Not because I have any funds at risk, but because it seems to signal that the barn is burning and the water bucket has a hole in it.