Reassurances that really make me nervous
Tuesday, Jul. 15, 2008 at 10:31am
There are several statements that are recognized as famously untrue the moment they are uttered. Some are not printable in this context but have to do with certain aspects of sexual restraint. Others are more businesslike, such as:
- "This investment has great upside with virtually no downside risk."
- "Our new pension plan is a terrific improvement on our old one."
- "This company is not for sale under any circumstances."
- "There are no further headcount reductions in the works."
- "I have nothing but confidence in Morty. He's a great senior officer and a true friend."
The latter, of course, is the last thing uttered by the CEO before the Morty in question is noisily shoved out a window from a very high floor.
In that regard, the following AP wire story gave me the willies this morning:
ASSOCIATED PRESS – 7/15/08
FDIC CHAIR: DEPOSITS IN NATION’S BANKS ARE SAFE
The nation's banking system is "absolutely safe" and Americans' insured deposits in banks protected, the head of the Federal Deposit Insurance Corporation said Tuesday.
"Insured deposits are absolutely safe," Sheila Bair, FDIC chair, said in an interview on CBS' "The Early Show." "The banking system as a whole is absolutely safe."
The FDIC insures bank deposits of up to $100,000 and up to $250,000 for funds in retirement accounts such as an IRA.
Bair said that while there will likely be more bank closings — like that of IndyMac Bank, which last week became the largest regulated thrift to fail — they won't occur on a large scale and should be put in "appropriate context."
"We've had five bank closings this year," Bair said. "I won't say that banks don't have challenges right now. They do." But, she noted, "No insured depositor has ever lost a penny of insured deposits throughout the FDIC's 75-year history."
Know what I mean?