If it’s in a big bank, nobodies money is safe

December 19, 2011 – We’re learning quite a bit from the MF Global disaster and if we’ve learned anything it is that buying gold coins and physically holding those gold coins is the best way to stop banks from engaging in the kind of behavior that is putting our entire financial system at risk. To start, banks have to make riskier and riskier bets in this market to keep generating the same returns they were making when markets were healthy. Ironically, this usually means making bets that are often counterintuitive to the implied fiscally conservative responsibility banks owe their customers whose money they hold in fiduciary confidence.

Over 400,000 accounts at MF Global representing $1.5 billion worth of money customer deposited in the bank are currently missing. As Jon Corzine testifies before Congress about the bankruptcy of the institution he ran, MF Global officials have stated that money is with a “Trustee” and customers “may” see it again. Why was MF Global using customer money to finance shaky bets on European sovereign debt? Because the Commodities Futures Trading Commission, the governmental agency responsible for overseeing the banks’ activities, issued a ruling that specifically allows them, and all banks like them, to do so.

The question that arises is whose money is safe? The short answer is, if it’s in a big bank, nobodies money is safe. Several customers at MF Global, including well-known pundits who have been advocating gold and silver as a means of wealth preservation for years, lost the gold and silver that they had been holding in accounts. Banks can and do use the gold and silver their customers deposit for safekeeping as collateral on questionable bets.

The best way to avert the entire scenario of a banker fuddling with your money and using it to pay off debts is now to put your money in gold and silver. It is highly advantageous in this market to hold that gold and silver yourself if it’s possible and it makes sense to you as an individual. While in your hands, no banker can use your gold and silver in ways that are completely legally sanctioned, extraordinarily morally questionable, and do not require disclosure to you as the owner of that money, even if the bet loses and your money goes to pay for it. With the investing environment now, the gold coins you buy increase your wealth over time while making it more difficult for banks and bankers to lose or erode your wealth. Fight back with gold coins.

Kevin Johnson

Senior Staff Writer – GoldCoin.net