If More Banks Go Under And Are Not Rescued By The Fed

[Waiting2go]

If certain banks go under and are not rescued by the Fed, what happens to our personal debt with them, such as credit cards, loans, etc?

Are those debts just "0'd" out or will they still have to be paid to someone? If we are still liable to pay them, who will we pay if they haven't been rescued and they have just simply collapsed? I worry too, that those interests rates could change drastically (for the worse) if paying to someone else.

Not implying that we shouldn't have to pay, just don't understand how it will be handled.

[BeNotAfraid]

I think they will likely be bought up by the banks that do survive...

[jds6958]

I believe you would experience windfall gains, however, I would expect more windfall gains from mortgages than CC, auto, or other types of debt.

If you do, don't forget to pay your windfall taxes.:lol2

[SummerSailing81]

Ok, I'm an idiot, what are "windfall" taxes?:hehee

[Waiting2go]

I believe you would experience windfall gains, however, I would expect more windfall gains from mortgages than CC, auto, or other types of debt.

If you do, don't forget to pay your windfall taxes.:lol2

I know what windfall taxes are, but you have completely lost me. I have no idea what you said actually means.

"SummerSailing", don't feel bad, I'm an idiot too on this and so many others things. Thank goodness for all the "smart experts" on here for teaching me so much.

[Waiting2go]

Ok, I'm an idiot, what are "windfall" taxes?:hehee

Anyone feel free to correct me if I say this wrong.

A windfall tax is an extra tax amount you have to pay when you have larger than normal profits. And it is also a higher tax amount than you would normally have to pay.

For example, if you are in a sales job and have a salary of $30,000 a year and at the end of the year, you get a $20,000 bonus (from your sales), you have to pay a windfall tax on that $20,000. Even though you normally may fall under a 20% tax bracket, your windfall tax on that $20,000 will be around 40%.

[logosone]

The cycle of major economic failures has historically run in or about 60 year intervals. There have been several factors that have artificially floated us slightly past that marker last experienced in 1929. We're now probably about a minute to midnight in continuing the cycle.

[Waiting...]

The cycle of major economic failures has historically run in or about 60 year intervals. There have been several factors that have artificially floated us slightly past that marker last experienced in 1929. We're now probably about a minute to midnight in continuing the cycle.

good point:candle

[logosone]

that main factor has been unbridled government spending and the credit brokers who are now crumbling under the staggering numbers.

[jds6958]

Anyone feel free to correct me if I say this wrong.

A windfall tax is an extra tax amount you have to pay when you have larger than normal profits. And it is also a higher tax amount than you would normally have to pay.

For example, if you are in a sales job and have a salary of $30,000 a year and at the end of the year, you get a $20,000 bonus (from your sales), you have to pay a windfall tax on that $20,000. Even though you normally may fall under a 20% tax bracket, your windfall tax on that $20,000 will be around 40%.

Yes, and what I was speaking of is when you inherit a house because the debt is erased either because of bk (unlikely to happen) or winning foreclosure litigation (could happen and has happened recently).

So you would gain the house (windfall gain) but you would have to pay windfall taxes.

That is the extent of my knowledge on the subject related to this discussion. I even may not have that correct as I learned it through a discussion in another thread.