Today is One Hell of an Anniversary…
It was 90 years ago today that the stock market crash of 1929 took hold…
Most people associate the crash with October 29th, Black Tuesday.
In fact, it’s said that the opening bell was never heard on Black Tuesday because of the shouts of “Sell! Sell! Sell!” were too loud…
But it was during the last hours of trading on Wednesday, October 23rd, 90 years ago to this day, that stock prices suddenly plummeted and the Dow lost 21 points – 6.33%, which really demonstrated how bad the stock market crash of 1929 would be.
Over the following days, investment bankers and government officials would do their best to calm fears, prop up the market, and keep the plates spinning.
But it was fruitless.
On Thursday, despite the efforts of President Hoover, the titans of Wall Street and corporate America, the stock market crash of 1929 lost another 2.09% and set records for the highest volume ever traded.
And from there, panic set in. At the end of the crash, over $25 billion ($319 billion in today’s money) was completed wiped out.
It took 25 years, not until 1954, for markets to reach their value before the stock market crash of 1929. All things considered, it was the most devastating crash in the history of the United States.
What Does the Stock Market Crash of 1929 Have to do With Banking?
That’s a great question, and a fair one given that this isn’t a history publication.
You see, McKinsey – the big consulting firm that charges governments and corporations way too much money for their insights – released a report this week about the global banking sector.
In it, they claim that 33% of banks around the world could fail during the next major financial shock.
We thought this was timely given the 90 year anniversary of the largest crash in US history.
But what do you think?
Could you imagine 33% of the banks (3 out of 9) in the country where you’re sitting right now closing down? All because they could not withstand a market event like the stock market crash of 1929?
Are they so poorly managed, over-exposed to bad borrowers, over-exposed to toxic investments, and so vulnerable to market movements that they could fail?
This isn’t a rhetorical question – think about it for a second.
If you’re interested in learning whether your bank account is safe, or you want to find a safe bank to open accounts with now, we highly recommend downloading your free copy of Recession-Proof Bank Accounts.
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As I write this note, I’m sitting in Panama – Panama’s banking sector is relatively well managed, decently regulated, and banks are conservative with their risks.
They have to be. There’s no central bank to come in and bail them out if they screw up. In other words, there’s no safety net if there is another event like the stock market crash of 1929.
When I think about the largest 9 banks in Panama, I don’t see them failing. In fact, when I think about the top 18 banks in the country, I’m not worried.
But, there are 78 banks in Panama. And when you start considering the other 60 banks, McKinsey’s figures start to sound about right… maybe even conservative.
Remember, we’re talking about the outcome of another market meltdown and all the implications that it would have, such as:
– Loan defaults by borrowers
– Plummeting investment value
– Margin calls by overseas brokers
– Currency devaluations & increasing FX risk
– Pressure from regulators to increase capital levels
– And much more
But Panama isn’t the concern. In fact, the McKinsey report highlights Europe and Asia as the major hotspots of potential banking failure.
As they put it…
“Nearly 35 percent of banks globally are both sub-scale and suffer from operating in unfavorable markets.”
They also went on to point out flawed business models as a key area of concern.
These are all factors that contribute to whether or not a bank is going to be able to protect your money in the long term, which is why we talk about them so much at GlobalBanks. Likewise, these factors will directly determine whether your bank is safe from economic shocks like those during the stock market crash of 1929.
Choosing a bank requires more consideration than simply walking into the nearest branch of your local bank. As one of our team members recently put it…
“You wouldn’t hand a bag of cash to a stranger and ask them to hold onto it without knowing if you could trust them. So why would you do that with a bank?”
McKinsey said that in order for banks to survive “merging with similar banks may be the only option if a full reinvention is not feasible.”
Fortunately, unless you own a bank yourself, you don’t have to worry about the calamity that reorganizing or merging a bank would cause.
Instead, you need to find a bank that is going to look after your money. And that means ensuring that you and your fellow depositors are not put at risk.
How can you find a bank to withstand the next major event like the stock market crash of 1929?
Well, you can either join our premium membership GlobalBanks Insiders and our support team would be glad to help you with that process (get more information here).
Or you can start by taking the steps that we outline in our Ultimate Guide to Offshore Banking – available right now at a 95% discount – only $9.85 – click here to get this limited time offer!
If that’s too pricey for you, feel free to grab a free copy of Offshore Banking Secrets & Lies where we uncover some of the key things to watch out for with banks – get your free copy here.
In any case, rest assured that there are well managed and safe banks available for you around the world. Banks that will actually protect and grow your money. You just need to know where to find them and how to avoid the pitfalls to successfully open accounts.
If you’re new here, that’s what we do: unlock the secret world of offshore banking so you can grow your wealth, protect your assets, and increase your freedom.
By using the information we provide, you will open ultra-safe bank accounts to protect your money. That means safety from corrupt governments, mismanaged banks, and frivolous lawsuits. And protect your money from future economic events, reminiscent of the stock market crash of 1929.
And while these secrets used to belong to the ultra-wealthy, that’s no longer the case.
We’re sharing them with our subscribers for free and giving GlobalBanks Insiders access to the best of the offshore banking world.
When you join our premium membership you get access to the tools and intelligence you need. You also get the key contacts you need to instantly access the offshore banking world. And that means open bank accounts, keep them open and avoid expensive mistakes.
Have something you want to discuss?
Feel free to get in touch with us by using the chat feature on our website. We’d love to know your thoughts and would be happy to answer any questions!
What Can You Do Next?
If you’re ready to take action and start opening international accounts now, you can access GlobalBanks IQ, our dedicated international banking intelligence platform.
GlobalBanks IQ gives you everything you need to start finding and opening accounts for you or your business today.
When you join GlobalBanks IQ, you immediately unlock the GlobalBanks Database of international banks — home to 250+ banks in 50+ countries.
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To get started, click here to see if GlobalBanks IQ is the right choice for you to start accessing the benefits of international banking today.
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