Friday, September 19, 2008

Bank Failure!

Bushco can't stop the on coming train...


On September 19, 2008, Ameribank, Inc., Northfork, WV was closed by the Office of Thrift Supervision (OTS) and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.

The FDIC has assembled useful information regarding your relationship with this institution. Besides a checking account, you may have Certificates of Deposit, a car loan, a business checking account, a commercial loan, a Social Security direct deposit, and other relationships with the institution. The FDIC has compiled the following information which should answer many of your questions


rrastronomo said...

I've been glued to cnbc for the last couple of days--seeing my portfolio gyrate unwitnessed before. Let's talk about the implications of this. When originators of mortgage loans no longer became responsible for the paper they under wrote, then that was the beginning of the end of financing as we know it. My hope is that we go back to the 20% down to buy a home. This would choke of demand, increase supply and dramatically drop prices. Of course, I have a vested interest in this because we are currently renting. I certainly hope that the underwriting standards for loans increase, and they will, but what are the results of the new laws that will be coming down the pike.

Bakonewbie said...

That is a great thing to hope for but I am afraid it won't happen. Our gov't has shown an eagerness to step in and I am sure they will.
We are in this mess because of the paper wealth created by easy to get credit for people who never earned enough to get it!
The Fed knows better than to let 20% down be the norm. That would bring us back to a time when people lived off their income (job) rather than the increased value of their home. (good times!)
That would bring this market down to where it should have been before the free money went around.
The Fed won't allow that kind of pain. They will make mortgages available to people. (private, semi-private or public funs, they'll make it happen)

In the town I grew up in (Villa Park- little city in OC) I saw homes in the $400's 10-12 years ago. At that time that was a TON of money. In the top of the market those same homes where $1.5 and more. (hell, a vacent lot was almost a million!)
Now I ask, in 10 years did the imcome of those people really go up by $200k+ to allow for the increasedprices? No, they used money to buy over-inflated homes with proceeds from other over-inflated homes that they sold, etc, etc, etc. I myself bought a house in Anaheim Hills in 2003 for $320k- a lot of money for me at the time- and sold it in 2005 for $680k, the buyer used 100% loans and it is now in default. (short sale for $450k right now)
The point is that like all pyramid schemes, the people at the top make the money but at some point the music stops and lots of people at the bottom look around and see that there are no new faces to take their place. Then it crumbles. (If you haven't been in a pyramid scheme before this might not be as clear as it is to me, I have seen them in OC during the early 90's and this is EXACTLY what happens with them- everyone makes money and re-invests and makes more but as soon as the flow of new people stops- BAM! No more new money and everything falls apart and the money stops)
With no new suckers to throw their money into over-priced homes the game is over.

I'd like to see the rigid lending standards that we used to have but it won't happen. We have come too far. Look at what gov't is spending, look at what firemen make! (or CHP? starting around $72k according to their website! No degree, starting wage!) Everyone bought into the hype and city, counties, states, etc all spent $ like this was REAL wealth.
How could we ever go back?

Bakersfield Bubble said...

Deflation kils the wealthy (top 99.999%) more than anyone else, they have control of our countries finances and they will do whatever they can to make sure we don't get deflation.

Here is the bailout proposal (this is going to be one of the largest transfers of wealth from the poor, middle class and upper class to the wealthy elite in the history of this country if it passes):

Anonymous said...

Just heard that JP Morgan Chase is buying WaMu's deposits.