SGM Metals: Greek Bank Runs Threaten Bank Stability, Where's the Media Coverage?

May 23, 2012 - PRLog -- CNBC reports: Updated at 10:45 a.m. ET [ Political leaders in Athens were due to discuss an emergency government Wednesday to deal with a possible run on banks as it emerged Greeks withdrew almost $900 million in a single day, fearing their country could crash out of the euro currency by the end of the week.

Greeks are withdrawing euros from banks, apparently afraid of the prospect of rapid devaluation if the country leaves the European single currency and returns to the drachma.

President Karolos Papoulias warned of “great fear that could develop into a panic,” the minutes of Papoulias' negotiations with political leaders showed, according to Reuters. The minutes also reveal Papoulias was warned that savers withdrew at least 700 million euros ($894 million) on Monday, Reuters said.

"Withdrawals and outflows by 4:00 p.m. when I called him exceeded 600 million euros and reached 700 million euros," the president said according to the minutes of the meeting. "He expects total outflows of about 800 million euros." Several banking sources told Reuters similar amounts had also been withdrawn on Tuesday. Nevertheless, there was no sign of panic or queues at bank branches in Athens on Wednesday.

Still, some were taking no risks. Jenny P., an Athens private medical clinic receptionist originally from Ohio, told msnbc.com she had withdrawn 85 per cent of "what's left" in her bank account. "We could have a new currency in a couple of days and nobody knows for sure what will happen," she said. "There are no lines to withdraw money, but maybe that's because many Greeks have precious little left in the bank. Many have been surviving on [$500] 400 euros a month, which has to cover tax, bills, food and medical costs."

Greeks have already been withdrawing their savings from banks at a sharp clip - nearly a third of bank deposits were withdrawn between January 2010 and March 2012, reducing total Greek household and business deposits to 165 billion euros. ]

How do you really think this is all going to end? How do you see the US recovery being able to gain any real traction if we have exported over 60% of our manufacturing capacity to third world countries and have no real jobs to put Americans back to work? Do you really think that just because the banks have been able to extort future tax collections from the government in order to protect their over leveraged portfolios they built during the inflation of the housing/credit bubble that you and your neighbor are in a recovery? Or is it just the bankers who continue to make record profits and therefor pay themselves record bonuses? Do you think the European sovereign debt crisis is over because they have created an inflationary solution to their crisis with the LTRO lending windows for the banks to do the exact same thing the US banks have done here in the United States? Do you think this global currency war led by the federal reserve will bode well for the average citizen around the world? Do you think all of this stimulus and bailouts might cause inflation that is growing by the day to turn in to hyperinflation some day?

Do you believe that simply tossing Greece out of the European Union will resolve the issue? Or do you think maybe the idea of redesigning the EU would create panic for the average investors & savers across the continent and cause them to wisely disengage from the fiat currency system of the west and wisely move into gold & silver bullion in order to salvage what is left of their life savings? And do you think this exodus out of paper money and into precious metals would create a surge in the pricing mechanism of the metals that will cause not only those looking for safety to rush into gold & silver but also those traders looking for the next profitable trade regardless of the asset? The answer is yes, it will cause a huge price spike in the precious metals. Ironically its not the profit potential that motivates most who hold precious metals to go down that path, instead its simply the wealth preservation characteristics that bring them into the best performing asset on the planet. But it is the coming tidal wave of demand that will also transform the wealth preservation aspects of precious metals into a huge profit generation tool as well.

Knowing that the current economic environment is far from stable should be all the encouragement you need to look into a wealth preservation strategy in precious metals. But if that isn’t quite enough then you should also consider the more desperate the banks become to appear stable the more radical the scenario will become in the economy itself and this will bring gold & silver up to price levels never before seen. This will bring every profit seeker into an already intimate market that is a powder keg waiting to explode at any moment. The more the banks have their hands tide trying to shore up their balance sheets as bonds get attacked by the bond vigilantes and keeping the stock market bubble inflated will begin to take a back seat which will begin to expose the true nature of the markets without the constant propping the banks have been able to maintain up to this point. This is when the world will be forced to realize that nothing has changed and the threat of another major down turn is greater than ever before. Establish your “Plan B” in gold & silver bullion today and begin to participate in the sound money debate. I can assure you there will be a day of reckoning soon enough that will bring these truths to the surface and you won’t want to be late to the game. Move now while the metals are still affordable because soon enough they will achieve levels you never thought possible. Tick, tock.