Hedge fund manager Hugh Hendry has warned that the Biden administration is mulling a freeze on U.S. bank withdrawals amid the decline in M2 money supply – a benchmark measure of how much cash and cash-like assets is circulating in the U.S. economy.
"Sometimes it's kind of relevant to panic. I would recommend you panic," he said. "You've seen the biggest waterfall decline in M2 right now. M2 is deposits, not loans. That's the deposits fleeing the system and going into money market funds," he explained. Hendry further warned that it could reach a point where the Department of the Treasury and the Federal Reserve will restrict the rights of Americans to withdraw their money. (Related: Health Ranger Report: Desperate U.S. banking system will LIMIT cash withdrawals to stop bank runs.)
He recounted that back in 1934, the federal government confiscated gold held by U.S. citizens in a private capacity by means of the Gold Reserve Act. It was only in 1974 that citizens were allowed to freely own and deal with gold once more, thanks to an Act of Congress signed by former President Gerald Ford.
Biden insists banking system is "safe and sound"
Hendry's warning followed hard on the heels of the failure of First Republic Bank (FRB), the third such institution to collapse in the past three months after Silicon Valley Bank and Signature Bank. Still, President Joe Biden is insisting that the U.S. banking system remains "safe and sound."
The chief executive encouraged Congress to provide federal regulators with all the tools they need to sell the distressed FRB and ensure all bank executives are accountable for the second-largest bank failure in U.S. history.
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"These actions are going to make sure that the banking system is safe and sound, and that includes protecting small businesses across the country who need to make payroll for workers and their small businesses," the president said. "We have to make sure that we're not back in this position again, and I think we're well on our way to be able to make that assurance."
Biden also assured the public that the banking system has "strong capital and liquidity levels" and is "well positioned to absorb potential losses." He also praised the Federal Deposit Insurance Corporation (FDIC) for its swift and effective response to the crisis. Responsible for insuring bank deposits, The FDIC worked quickly to ensure that depositors' funds were protected and that the bank's assets were transferred to a healthy institution.
"The rescue comes less than two months after a deposit flight from U.S. lenders forced the Federal Reserve to step in with emergency measures to stabilize markets," according to Fox Business.
Several laws had been passed, including the one that gave birth to the Consumer Financial Protection Bureau, to avoid a banking collapse similar to the ones in 2008. But the truth is that these laws failed – leading to the collapse and tighter government control that Hendry warned about.
Follow Collapse.news for more news about the American banking system's collapse.
Listen to the full segment of the "Health Ranger Report" where the Health Ranger Mike Adams talks about banks limiting withdrawals to stop bank runs.
This video is from the Health Ranger Report channel on Brighteon.com.
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Top 25 US banks lose $89.7B after withdrawals surge following collapse of SVB and Signature Bank.
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