RE: LOW-LIFE DOWNVOTING MEMBERS
The bank was not setup or designed to specifically scam its customers.
You don't seem to understand how fractional-reserve-banking works.
It's the mother of all ponzi-schemes.
Click to watch 28 minutes (or just the first 5 minutes),
Also, most banks have (or should have) deposit insurance which will compensate customers to certain limits, in the event of a bank failure.
None of the customers of Washington Mutual Bank "lost their deposits", those were all transferred to the behemoth Chase Manhattan Bank.
It's the people who had their retirement funds and 401k heavily invested in WAMU STOCK who lost their shirts when it went to ZERO with basically no warning.
This is exactly the type of "investor protection" scenario the FTC uses to justify their existence (oh, we must have someone looking out for investors). AND they just stood by and did NOTHING.
"It's the mother of all ponzi-schemes"
No, fractional-reserve-banking is NOT a ponzi scheme, simply because customer deposits are insured. As such, customers are not at risk of losing their money. Investing in a bank (or other company) as a shareholder is a different issue. That is governed by the SEC, NOT the FBI.
Hoo-boy, I almost forgot about the INSURANCE SCAM.
Do you realize that the FDIC has nowhere near the cash-money-dollars it would take to payout $10,000.00 per depositor? If even a single big bank truly went belly-up, the FDIC would be instantaneously flat-broke.
Have you ever heard of AIG?
Do you know who they sold insurance to?
Spoiler alert, they sold insurance to the worlds largest insurance companies (and AIG went broke).
That's a ponzi-scheme. If you promise people their money, but don't actually have enough money to pay them (if only 10% of customers close their accounts and cash-out, the bank is done-for) then you're running a ponzi-scheme.
The FDIC is an agency of the Federal Government. In reality, it can never go broke. All FDIC insured accounts will get their money back in case of a bank failure. That's the whole point
"If you promise people their money, but don't actually have enough money to pay them (if only 10% of customers close their accounts and cash-out, the bank is done-for) then you're running a ponzi-scheme."
No, that is not by any means a ponzi-scheme. Not being able to pay out deposits due to the normal course of business does not constitute a ponzi-scheme. It would only be a ponzi scheme if the bank was originally setup to take deposits, with no intention of ever returning them, or ever paying interest on them as advertised.
It can however, run out of "cash-on-hand".
Why do you think they went insane printing money in QE1, QE2, QE3, QE4?
Did you know we're currently in an "unofficial" QE5?
"It can however, run out of "cash-on-hand"."
That is true! But as we know, it does not take long to start up those printing presses. Of course that it not a good thing because it simple deflates the value of the dollar. The alternative is of course to borrow more money, and that is perhaps even worse in the long run, depending on where we borrow the money from.
PS. Speaking of money, thanks for delegating the voting power. I shall try and manage it wisely. :)
I've been lucky enough to find at least a handful of people who seem reasonable and willing to engage in civil conversation.
If I undelegate at some point, don't take it personally, I probably just have other priorities demanding my attention.
I believe delegating is vastly superior to casting my below-minimum-payout vote around.
But that's exactly what a BANK does.
You accrue interest on paper, but the bank never has enough capital to cover that paper.
A few people can get out ahead (just like a casino, even Bernie Madoff had a few customers that withdrew huge profits), and by doing so "prove" that "the system works", but just like a casino, they eat you up with fees, and they'll even hold your funds if you try to withdraw any amount greater than a couple thousand bucks (the "Bank Secrecy Act" makes this even worse).
That's actually one of the most attractive aspects of steem (and crypto generally), namely that I can send tokens of value to whomever I wish, whenever I wish.
Notes on the Bank Secrecy Act,
It has been amended several times, including provisions in Title III of the USA PATRIOT Act, which amended the BSA to require financial institutions to establish anti-money-laundering programs by establishing internal policies, procedures, and controls, designating compliance officers, providing ongoing employee training, and testing their programs through independent audits.[4] WIKI
"You accrue interest on paper, but the bank never has enough capital to cover that paper."
That is true, but aren't a lot of things setup that way? Technically they have no means to fully comply with their obligations at any given time. And that reminds me of fitness clubs. Take your local fitness club for example, that can perhaps facilitate 100 or so members at any given time, yet those clubs will often sell 1000s of memberships. Imagine if all those members showed up at one time!!! :)
Good example.
I believe there have been some proposals to keep clubs from charging a customer if they don't show up for 31 days.
If your business model relies on charging people for ZERO services, you are running a scam.
"If your business model relies on charging people for ZERO services, you are running a scam."
But isn't that exactly what Steemit is doing? What benefits (or services) do the vast majority of Steemit members gain from their investments? I would venture to say...Nothing! No other significant public forum requires members to invest money in the platform. True, you can get most of your money back, but only after waiting a total of 13 weeks, and only then if the value of your Steem investment does not drop significantly before you have a chance to trade or cash it in.
Is Steemit a a ponzi-scheme? Perhaps! Different people no doubt have different views on that.
Is Steemit a Scam? I believe that it is because the vast majority of members do not fully understand what the platform entails, primarily because that is not clearly explained for the layman to understand. Sure the facts may be embedded somewhere within Steemit's FAQs and so on, but as I am sure you will admit, they are not spelled out in plain for most to understand, and certainly not for those whose first language is not English.
Is Steemit an unethical business model? Absolutely! Most certainly! There may be no other platform like it, and I think that is for good reason. First of all, no honest person or company would ever develop a system like Steemit has done. It just would not happen! And secondly, it is simply not a sustainable business model. You can;t keep paying out money (no matter how small) without incoming revenue. Even Steemit has been forced to admit that with it's near bankruptcy last year, and the layoff of 70% of its staff, and other cost cutting measures, such as drastically reduced payouts and so on.
Permanent web hosting.
No capital investment is required.
No other significant public forum offers free permanent web hosting and 100%transparency (blockchain FTW!!).
Sure you can get downvoted, but you know who did it.
If you get flagged (insta-banned) on yo.tube or fa.cebuk or pa.ypal, you have ZERO recourse.
ZERO. You don't know who did it, you have no way of asking them, and you have nobody to request help from.
What would be your wish-list of key design features if you had the resources to design your own social-network with exchangeable value-tokens?
This is only "true" technically. If they actually handed out that much cash, inflation (liquidity) would be through the roof and your cash-money-dollars would be next-to-worthless.