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Your bank's Texas Ratio


The Texas ratio is a measure of a bank's credit troubles. - http://en.wikipedia.org/wiki/Texas_ratio

Earlier in 2008, I was posting about bank failures (among other things) and I took just a bit of an issue with the secrecy of the "troubled institutions" list - as if you don't have a right to know. If you're still content (after bailout-mania) to listen to the beady-eyed liars who told you "don't worry, be happy" right up to the moment when they screamed "imminent economic crisis", this post isn't for you. Nothing to see, here, move along.

For the few who think my track record is good enoughEmbarassed, here's someone else's thoughts on the matter of potential bank failures.


If you want to cut right to the chase and know about your own bank, someone else put together a long list of banks in the U.S. and their "Texas Ratios" - http://www.lewrockwell.com/chris/banks/banks.html

No guarantees, just putting info out there, FWIW; which is more than you'll get from regulators [who will make sure their own ASSE(t)S are safe first, before they tell you anything] or from the 'useful idiots' who always defend [and want to believe] the liars right up until the moment the truth is unavoidable.

Entry #192


Rick GComment by Rick G - December 31, 2008, 8:13 pm
Thanks for the info. I belong to a credit union...I think it's safer (no mortgage loans, private deposit insurer, etc.)

Everyone should be prepared for an unexpected bank closing (or "holiday") or credit card freeze. Have a stash of cash on hand, especially if your bank is questionable.
time*treatComment by time*treat - January 1, 2009, 5:25 am
Thanks, Rick.
I forgot about those. Credit Union accounts are National Credit Union Admin (NCUA) insured up to $250K, for now. Some get into home and car loans, but they tend to have higher standards for lending.
justxploringComment by justxploring - January 1, 2009, 2:03 pm
Time*treat, there was never any doubt in my mind that banks would fail. In fact, I expected many more in 2008 because of all the media hype. I expected BankUnited to shut its doors (and I have an account there) but I was never too concerned since I don't have more than the $250,000 limit and, unless FDIC can't meet its obligations, I'm covered. I'll gamble that won't happen. Just like the auto makers, if people stop doing business, then the banks definitely WILL fail. Why would the FDIC publish a list and cause a run at the banks? That would be irresponsible. Again, I keep hearing people shout "Fire!" but in the late 1980s (I think it was 1989) there were 534 banks that failed. If you take all the lending institutions that failed during 2007 and 2008, I think they add up to 20 or less.

I don't know why anyone needs "a stack of cash on hand" Rick.   Anytime a bank has failed, depositors have had ATM access. Newspapers love to show photos of panic-stricken investors, yet IndyMac is still in business today. AFAIK the people with insured bank accounts there didn't lose money, although the media showed people standing in line in the heat practically starting riots. Most of the time a takeover is on Friday and the bank reopens and does business as usual on Monday. Rick, a credit union is fine. I belong to Suncoast Schools but I shop for rates. However, if someone is really worried about a bank failing and not having immediate access to money, then having small accounts in 2 or 3 banks would take care of that problem. I know ratings don't always mean a lot, but you can use sources like bankrate safe & sound and bauers financial, both recommended by the FDIC, and only use banks with 5 star ratings. Don't get me wrong - I never said I trusted the government and I think the Federal Reserve is criminal and should be dissolved. But I see no conspiracy to hide lists of banks that might be in trouble. IMO keeping lots of cash in your mattress, (which in my case hasn't accrued high interest lately LOL) is wasteful. I hope if you do keep cash at home, you have it in a fireproof safe.
Rick GComment by Rick G - January 1, 2009, 4:46 pm
The best place to invest your money today is at the grocery store...non-perishables.

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