I came into the world in the middle of the Great Depression. My late father was an accomplished musician, so he was lucky enough to work three part-time jobs to keep his family together through the worst of it.

As a child I assumed Franklin D. Roosevelt was America’s only president. He was the only one I knew about until my seventh year when he died in April, 1945.

One of FDR’s memorable quotes, (and there were many), was in the opening paragraph of his First Inaugural Address, on March 4, 1933. FDR spoke the words at a time when America was in an economic panic, banks were closing, unemployment was soaring and the stock market had collapsed.

By the time the market crash bottomed out in 1932, stocks had lost nearly 90% of their value and the market did not again reach its previous highs until 1954.

The new president understood that the American people wanted reassurance and hope, but he also wanted them to understand that irrational fear was standing in the way of recovery.

Thus it was that he intoned his famous quote: “This great Nation will endure as it has endured, will revive and will prosper. So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself – nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.”

It’s hard to understand the impact of this financial crisis until it hits somewhere close to home. Last evening I was on the phone with my daughter, and she asked if I thought she should transfer funds from her bank to a credit union as a protective measure.

I explained the role of the Federal Deposit Insurance Corporation (FDIC) and that there was a companion agency that insured credit unions, the National Credit Union Administration (NCUA)

So there’s no need to transfer assets because the United States government is the insurer of last resort in both cases. And backing the government are 300 million plus Americans and the trillions in taxes they pay. (For more about the FDIC, click here for an essay by David Newman, Market Analyst for The Sovereign Society.)

The FDIC insures up to US$100,000 in a single account, per account holder. If you know the rules well, however, it is possible for a single person to extend that coverage to more than US$500,000 at one bank. You can do this by using multiple account ownership categories (private, commercial, business, investment) since the US$100,000 insurance limit applies by account category and per account holder.

Check back on Thursday and I’ll give you my seven-step asset protection checklist for shielding your cash even if your accounts are worth more than US$100,000.

BOB BAUMAN, Legal Counsel

Source: The Great Depression of the 21st Century?