Where is investment money safest, if there was another Great Depression?

Question

Hi,

If there were another devastating Great Recession, with which broker is my money safest? Etrade, Scottrade, TdAmeritrade... ?

Answer 1

It doesn't matter which broker you choose - all your accounts are protected by SIPC, which will protect you against any losses of CASH or securities that are held in your brokerage account, but WILL NOT protect you against investment losses.

It is where, not with whom, that you invest that cash - if in stocks, then you are at greater risk than in bonds or in government securities.

If it is security in the event of a depression that drives your investment strategy, I suggest that you choose a bank or credit union that offers the most competitive interest rates, knowing that your money will be protected by the FDIC or the NCUA.

Contrary to what was written above, NO brokers are insured by the FDIC.

Answer 2

Although the accounts at all are insured by the U S government up to $100,000 and they carry additional private insurance, don't count on it being absolutely safe. Unfortunately, your money would be safest in cash in a readily accessible location, not a safe deposit box. Governments have been know to declare bank holidays which could include brokerage firms that could last indefinately. Next safest would be t-bills but I would be extremely dubious.

One might consider gold coin as perhaps a safety net. There is the possibility that the government would choose to drastically inflate the currency to spend the country out of the depression, like Germany attempted, an extremely likely possibility. The problem with gold coin is where the heck to store it.

Answer 3

We are far from another 'great depression' but if you are worried about your bank closing or filing for bankruptcy and you have over 100,000 in the bank I would look into it further. Otherwise you are safe and because of all the safe guard the government has put in place (I.e. FDIC) there is a very very unlikely chance that we would ever have another great depression. Heck we are not even technically in a recession yet.

Answer 4

Gold.

Gold shares : GLD or IAU bought through any discount broker.
Silver shares : SLV bought through any discount broker.

Gold coin (American eagles, buffalos or maple leafs) kept in a safe deposit box. Safe deposit boxes are not expensive & are much safer than your house. You can also store important papers there, safe from fire & theft.

Gold Futures. (I do not use these but they exist so here they are listed)

Gold & Silver mine stock. Unfortunately denominated in the incredible shrinking dollar but IMHPOV still worthwhile.

Buy some gold as part of your portfolio; it moves in almost the opposite direction from the stock market, so it's a good addition before the Depression as well.

Good Investing !

;-)

Answer 5

Unless you are expecting that the gov't goes bankrupt then they are all equally safe. They are all FDIC insured so your money is safe up to $100,000 for individuals or $200,000 per married couple. So just make sure not to have more than that per account and you'll be fine.

Answer 6

your only recourse is the bank those are insured up to 100k for single and 200k for married.

The SIPC is insurance for FRAUD (like Worldcomm and enron) not depressions. If the market tanks that badly you should sell what you have and put it into an fdic bank insured account.

Answer 7

Savings bonds and treasury bills...backed by the full faith and credit of the United States.

Answer 8

Gold and toilet paper (great for bartering).

Answer 9

buy weapons..they are the safest bet..:)

Answer 10

Under your mattress....