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Thread: How to avoid Bank Bail-Ins?

  1. #1

    Default How to avoid Bank Bail-Ins?

    At this point I believe global bank bail-ins are very much a risk, so I'm looking for ways to avoid it. I don't know if they're likely, but by my estimate they are the most dangerous risk to me personally. I assume that even assets under the nationally insured amount, or things like equities and precious metals held by the bank for you, are also at risk.

    So how do we avoid them? A few idea's off the top of my head:

    - Precious metals: an obvious choice on this forum, assuming you can hold it outside of the banking sector. Safety deposit vaults inside the bank seem acceptable, but even if they don't get confiscated, accessing them would likely be limited and risky.

    However by my estimates PM's are highly overpriced at this moment, I suspect because the banks will want people to buy them at high prices in the case of bank bail ins and then crash them. This might sound crazy to some but that's exactly what happened when Cyprus did the bail ins in 2013, the bail ins happened late March, and just 3 weeks later gold dropped $250 overnight.

    - Cryptocurrency: similar to PMs, it can be easily held outside of the banks, but it too was crashed right after the Cyprus bail ins, just a day before the PM crash actually. A bigger issue with crypto is that can very easily be banned by major governments. In this sense I consider it a honey trap for central bankers, something that the masses will run to if they lose trust in the traditional banking system, but which can easily be shut off and devalued with the stroke of a pen. The fact that its value is relatively low suggest they are leaving room for it to go up as the market rushes in, only to be made illegal and crashed when it peaks.

    - Brokers: back in 2008 many banks needed a bail out to be saved, but practically no broker suffered any issues. This because generally for brokers that don't have a bank license it's illegal to trade with their clients' money, as such they normally don't have market exposure.
    The problem then is that most brokers will put your money with banks to hold it for them. However in this aspect I feel brokers are safe, as bail-ins generally only affect normal depositors, and not companies or guarantors. The Austrian bail ins of 2015 seem to confirm this.
    An additional advantage of keeping your money with a broker is that you can't keep trading, when everyone who put his money with banks will see it frozen. In such chaotic times, cash is king.
    One caveat is that I've seen US brokers offer their clients to spread their cash money over multiple banks up to the maximum government assured amount per bank, as to maximize interest rates. However I suspect this will be held directly in the client's name, in which case bail ins could at least freeze the money.

    - 100% reserve banks: I thought these existed, namely some private Swiss banks, but it seems this is no longer the case. If anyone knows of any do share.

    - Singapore and Hong Kong Banks: I've heard they hold unusually high reserves compared to other regions, would this be a benefit? They only insure up to $50k in local currency which doesn't exactly sound dependable to me.
    All opinions expressed by metalox are purely hypothetical.
    Sell when everyone else is buying!

  2. #2
    Join Date
    Jun 2020


    Save your Dollar denominated assets in 401k (although the Gov. will one day be "managing" those also) as if you must (and we all must) swim in the Fiat shark tank 401k's are the most protected.
    All other wealth has to be saved in Tangibles > From the known to the unknown, illiquid through the most liquid.

    Banks Pffffff you'd have to be nuts> And why

  3. #3


    A new wrinkle that further erodes my already weak confidence in banks -

    With banks holding crypto, does that mean that they will be able to issue you bitcoin if they run out of USD? They already replaced gold with gold certificates, then silver certificates, then fiat. Now crypto? What next? Pictures of chicken feathers?

  4. #4


    The answer is super simple if Cyprus in 2013 is to serve as any example.

    People in Cyprus with less than 100,000 euros in their accounts will have to pay a one-time tax of 6.75%, Eurozone officials said.

    Those with greater sums will lose 9.9%.

    Depositors will be compensated with the equivalent amount in shares in their banks.

    Reports suggest that depositors will be able to access all of their money except the amount set by the levy.
    As long as holding physical gold is legal, then you simply must convert your savings to physical gold.
    I was driving across the burning desert; When I spotted six jet planes; Leaving six white vapor trails across the bleak terrain; It was the hexagram of the heavens; it was the strings of my guitar; Amelia, it was just a false alarm. --Joni Mitchell, Amelia

  5. #5


    Buy "museum quality" artwork and antiques. The highest of the high end stuff always has decent resale value. I've noticed that rich people do this, so there's gotta be something there.
    No his mind is not for rent
    To any god or government
    Always hopeful, yet discontent
    He knows changes aren't permanent
    But change is

  6. #6
    Join Date
    Jun 2020


    This is from a Goldman Forcast so yea, buy anyTHING........ It's the Decade of Tangibles ..... Although I hope most were smart enough to prepare last Decade for this certain to be nightmarish current Decade.

    -more downside expected in US real interest rates
    -Combined with a record level of debt accumulation by the US government, real concerns around the longevity of the US dollar as a reserve currency have started to emerge"
    -Pandemic measures taken for the economy will lead to a significant rise in debt in the future, which in turn will lead to policymakers allowing inflation to rise, boosting precious metal prices

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