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I found the article submitted by Memphis very enlightening and wanted to share -- In light of what our banks have done in the past and some are still doing -- I feel it is wise to "Be Wise" with where we put our money post RV - I like having options - especially "safe" ones - UNEEK Memphis » July 11th, 2013, 12:54 am • Tonight on the CC Bluestar made a reference to the banks and their respective levels of capitalization. Simply put, this is referring to a ratio of how much money does the bank keep on hand (liquidity) vs how much have they committed in various ways such as lending and speculation. The higher the ratio the better any given institution is prepared for a 'rainy day'. The reality is that these are sober times and a 'rainy day' is not just a metaphor, it's a foregone conclusion. Allow me to repeat this: These are sober times and a 'rainy day' is not just a metaphor, it's a foregone conclusion. Our biggest unknown variable is time. If you read my post earlier in the day you will appreciate the gravity of this discussion. In an effort to make this discussion more plain to people here is a recent email that IMO does an excellent job of speaking to this subject. Read it if you have interest and then perhaps follow-up as Bluestar has suggested. :handshake2: NONE of what follows is from me. I try to source news and information from smart people and (IMO) Simon Black fits this description.....well. I am not attempting to promote him here but simply be clear that none of the credit goes to me! On a side note, very soon the RV is going to be "past tense". After the RV? Such discussions as this one will suddenly become reality to all of us. Eagle1 has been doing a great job of pointing and I am simply shining a light here on what he is pointing at! Blessings, Memphis Sovereign Man June 25, 2013 Santiago, Chile At our Offshore Tactics Workshop in Santiago three months ago, Jim Rickards (author of the acclaimed Currency Wars) told the audience of roughly 500 people-- (paraphased) 'If one of you stands up right now and heads for the exit, the rest of the audience probably won't pay much attention. If ten of you do it, one or two people may notice and follow. But if 400 of you suddenly head for the exit, the rest of the audience would probably follow quickly.' It's a great metaphor for how our financial system works. The entire system is based on confidence. And as long as most people maintain this confidence, everything is fine. But as soon as a critical mass of people loses confidence in the system, then it starts a chain reaction. More people start heading for the exit. Which triggers even more people heading for the exit. This is the model right now across the system. And it's especially pervasive in the banking system. Modern banking is based on this ridiculous notion that banks don't actually have to hang on to their customers' funds. Banks in the United States typically hold less than 10%, and even less than 5%, of their customers' savings. This is particularly true among smaller regional banks. As an example, BB&T bank is holding about $3.2 billion in cash equivalents on $131 billion in customer deposits. That's a ratio of just 2.4%. The rest of customer deposits are mostly invested in residential mortgage backed securities (similar to those which collapsed in 2008) and commercial loans. In fact, the bank's loan portfolio exceeds total customer deposits. Not exactly the picture of financial health. In the UK, the situation has become so absurd that British regulators are allowing some banks (Lloyds, Royal Bank of Scotland) to plug their gaping capital deficits with FUTURE earnings. Now, I'm not trying to badmouth any particular bank here; these examples are representative of the entire western financial system. Yet few people give much thought to where they park their hard-earned savings. We're deluded into believing that our bank is safe. It must be, after all. It's a bank! And... it's backed by the government! Sure, never mind that the balance sheets of insurance funds and sovereign governments are in even worse shape. That this system is still functioning at all is due almost entirely to confidence. There is no fundamental support propping it up. And a system built exclusively on confidence can unravel quickly. This is why it's so important to give a lot of thought to your financial partner. Do they have a fundamentally safe balance sheet? Or is it just smoke and mirrors? Take a look at your own bank's balance sheet. How much cash do they hold as a percentage of deposits? How big is the loan portfolio as a percentage of deposits? How much equity does the bank have as a percentage of deposits? If you're not satisfied, find another bank. And you may have to look overseas at stronger jurisdictions. Singapore is one place where I'm happy to park capital. OCBC for example, holds a whopping 38% of customer deposits in cash equivalents... ten times as much as many banks in the West. Its total loan portfolio is far less than customer deposits. Total equity exceeds assets by a margin of 2:1. And it resides in a nation with effectively no net debt. I'm not necessarily endorsing OCBC, but rather citing it as an example of what a healthy bank balance sheet is supposed to look like. Many banks in Singapore hold similar figures. Bottom line, it matters where you hold your savings. Balance sheet fundamentals are critical. And moving your hard-earned savings to a well-capitalized, highly liquid bank is one of those things that makes sense, no matter what. If nothing happens, you won't be worse off for it. Yet if the confidence game collapses, you'll be one of the few left standing with your savings intact. Until tomorrow, Signature Simon Black Senior Editor, SovereignMan.com