Doom and Gloom Has Got the Best of Us

"My husband and I are in our seventies. We have our entire retirement fund in bank CDs. Every day we hear more dire reports concerning [our bank]. And now the FDIC is almost bankrupt. We are worried and feel we should take our money out of the bank, but where would we put it?"

The simple fact is that the weight of the government stands behind all insured bank deposits. The Savage Truth is, there aren't enough trees on the continent to print all the paper dollars that would be necessary to give every depositor his or her cash if they wanted it! We all understand that our banking system is built on confidence. Political bickering only undermines confidence, and the system.

"I have retirement annuities with AIG. How is AIG insured and should I move it out of AIG into another company or different product in another company or a CD?"

Despite the fact that there is no federal backing of insurance company products, the government will not let major insurers fail. Most large insurers have reserves for unexpected events, whether hurricanes, earthquakes or financial uncertainty. But the government can't let big insurers fail because they'd bring down the system. So let's stop complaining over the details of the AIG rescue, and revisions, and get back to work on the economy.

President Kennedy, a positive example: Economic growth solves most of these problems. Tax cuts are the prescription for economic growth. That is not a partisan political analysis. Proof? Try this statement from President John F. Kennedy on July 17, 1963:

"The most urgent economic business before the nation is a prompt and substantial reduction and revision of federal income taxes in order to speed up our economic growth and wipe out our present excessive unemployment."

President Kennedy is remembered not only for his tax cuts, but for his positive attitude. He said we could put a man on the moon. We believed him and we did it.