How to Prepare for a Bank Holiday

A Checklist of Practical Actions You Need to Take Now…

As the markets whipsaw up and down like a rollercoaster, it’s a good time to remind yourself of this:

You need to prepare for a bank holiday.

Our current global financial system is a Ponzi scheme, built on a house of cards, and constructed on a foundation of lies. It can’t continue on indefinitely without crashing, and that means a crash is certain to come. When it does, global credit markets will freeze, and the government will declare a bank holiday.

What is a “Bank Holiday?”

Contrary to what you might think, a "bank holiday" isn't a scheduled day off for financial workers. It's an emergency government measure only undertaken as a last resort to restore stability to financial institutions, reassure the public, and restore confidence in the banking system. During a bank holiday, markets and banks remain closed until government regulators implement new measures to jumpstart credit markets and restore the orderly functioning of the financial system.

A bank holiday last occurred in the United States in March 1933 at the height of the Great Depression.

It’s important for everyone to understand what a bank holiday is and how to prepare for one, because the authorities won’t give you advance notice a bank holiday is coming. They’ll just implement it.

Have no doubt, you and I are the last people they’ll tell. Don’t believe me?

Here are some clips from a 2022 FDIC "Systemic Resolution Advisory Committee Meeting." It gives you an idea of what the public should expect in the event of a systemic financial crisis:

Take careful note of one of the comments made:

"...a public that has more full faith and confidence in the banking system than the people in this room do."

The people most intimately familiar with the global banking system don't have full faith and confidence in it, but they want you to.

And lest you think these comments are taken out of context, here's the entire three-hour plus meeting in its entirety. I've watched it, and none of these comments are taken out of context. In fact, we talked about them at the time they were made. You can watch that video here:

Why am I bringing this up now?

Because, given the volatility we’ve seen in global markets these past two weeks, the probability we’ll see a bank holiday in the next few weeks or months is much higher than it was even just a month ago.

Why Risk is Heightened Right Now…

As reported in ZeroHedge earlier this morning, J.P. Morgan believes we're in a liquidity crisis right now.

And as Chris Martenson points out below, that's a big deal:

As I write this article, we're in a liquidity crisis. If they fail to contain it (and I believe they will), we'll be in a systemic crisis in the very near future. In a systemic crisis, "the plumbing" of the global financial system freezes. That's the moment in time we're referring to - a point in time when the credit market freezes, and governments around the world are forced to institute a "bank holiday."

As described in my article, "How the Current Global Financial Crisis Leads to Biblical Tyranny (in 10 Steps)," as a liquidity crisis becomes a solvency crisis - something big blows up - and this becomes the final stage of the crisis prior to the institution of a bank holiday:

As the largest bank run in history spreads across the globe, years and years of central planning and economic mismanagement will surface in the form of smaller implosions throughout the global economy. Think of a leaky boat where the occupants frantically rush to plug the leaks, but for every hole they plug, three new leaks spring forth. These implosions will include major problems in the global derivatives market – estimated at somewhere between $1 and $4 quadrillion dollars. According to the Office of the Comptroller of the Currency, four banks – just four – hold “87.6% of the total banking industry notional amount of derivatives.” That means the failure of just one of those banks will be enough to collapse the entire global financial system (i.e. those banks won’t be allowed to fail).

Also, as we saw during the Great Financial Crisis, this crisis will expose fraudulent activity. In 2008, Bernie Madoff was exposed for running the biggest Ponzi scheme in history. Expect to see more Bernie Madoffs. In addition, expect several hedge funds, high-net worth individuals, and/or other financial entities outside of the traditional regulatory system to be exposed as frauds for pledging the same collateral to multiple financial institutions.

On Wall Street, expect to see several major failures of brokerage houses and, more importantly, intermediaries responsible for the stock settlement process. Their failure will expose a fatal flaw in the system. When someone “shorts” a security, they “borrow” it from someone who owns it, sell it into the open market and promise to buy it back later (they hope at a lower price, pocketing the difference). When this happens, two people think they own the same security. This is called naked short selling, and it’s illegal in most countries. Nevertheless, it still happens. And we won’t know to what extent the law has been flaunted until the system breaks. When it does, many people will learn they don’t own what they thought they owned.

When these financial entities fail, contagion will spread throughout the global financial system. The threat of counterparty risk will cause global credit markets to freeze as distrust spreads throughout the system. This is the moment when the entire system will “break.”

We’re seeing signs of heightened risk right now. For example, when the top executives at some of the world's largest banks start meeting for private discussions in the midst of chaotic global markets, that means either something has already broken or they're figuring out what needs to be done to prevent something from breaking.

Have no doubt. The current market volatility has Wall Street rattled, as we read in this X post.

Or how about this article? It’s titled, "I am a Junior at a Top US Bank. We Openly Discuss Whether This Bank is Going Under."

Don't get caught off guard. You need to be prepared.

As the Bible says:

"A prudent person foresees danger and takes precautions. The simpleton goes blindly on and suffers the consequences." Proverbs 27:12 (NLT)

Below is a list of all the things you need to do to make sure you're prepared for a bank holiday.