ATM Limits Down to $100 – Do the Banks Actually Have Any Cash?

ATM Limits Down to $100 – Do the Banks Actually Have Any Cash?

A couple of weeks ago, an investment writer I respect a great deal wrote that he recommended everyone take out some cash from the bank and keep it on hand – enough for a month or two of living expenses.

Since then, I’ve heard this mantra repeated in several other financial publications. Extended bank “holidays” have not happened since the 1930’s, to my knowledge – but enough smart people are now sufficiently scared that I am, well, sufficiently scared myself.

Now let me be clear, I have almost no money in my savings or checking accounts – I haven’t pulled a salary since I left my job in March. And self-funding our early stage software startup has not exactly been conducive to building up a cash hoard.

Anyway, I voiced my concerns to my wife (yes, the same wife who had previously yelled at me to stop trading the Yen) and voiced my concerns.

Me: “Hey Honey – we should have some cash on hand. If this financial crisis gets much worse, they could declare bank holidays and lock up cash. Because the banks don’t really have any cash.”

Wife: “Really?”

Me: “It could happen.”

Wife: “But WE don’t have any cash in the BANK either. Because I have to pay for everything now, and…I don’t even know where you’re getting your money from. I don’t want to know. In fact, I can’t read your blog anymore, it makes me cringe – our friends think its funny, but it’s not as funny when your own life savings depends on the Yen or Soybeans.”

Me: “Your hair looks great today.”


So, with ~$16K of credit card debt, no income, and no cash in the bank, I realized I’m in quite the pickle! Not exactly prepared for a financial system meltdown myself!

Well a gift from the Gods dropped into my mailbox yesterday:

Yes, an offer from my only credit card without any juice running, that they’re offering 3.99% APR on any:

  • Balance transfer, or
  • Cash advance

I had to reread this offer a few times, and splash some cold water on my face. Who in their right mind would lend money at 3.99% – with inflation running at a much higher rate – and lend in US dollars no less, a currency on the verge of collapse?

Well I wasn’t arguing – I wrote myself a check for $9K, my new credit limit, and sprinted to the bank! Take the money and run!

Well after depositing my new fat check, I hit the old “another transaction button”, with the goal of taking out $500 or so to stuff under my mattress.

And much to my chagrin, I was only allowed to take out $100 at a time! (This is Wells Fargo, if you’re keeping score at home). Then I had to withdraw my card, reinsert it, in order to take out another $100. Rinse and repeat. No longer an option to select or key in a withdrawal over $100!

It seems as if the US no longer has any physical cash, or physical gold. Barter, here we come. Sugar, anyone?

We got the last $1,000 in the whole town!