Some Around Vegas Panic In Wake of Nevada Bank Closure, Market Meltdown
Southern Nevadans are panicking and considering extraordinary steps to avoid losing more money in the stock market, real estate and even bank savings accounts, one local banker told the Las Vegas Review Journal.
John G. Edwards of the LVRJ told of how one 80-year old man asked a Southern Nevada bank if he could remove three quarters of a million and place it in a safety deposit box. An interesting footnote to this is that companies selling personal safes have become major draws at national home furnishing shows and expos.
Another business owner said he has spread $2 million in deposits among several banks so all of it is under the $100,000 federal deposit insurance maximum. Yet, the businessperson is considering moving it to Bank of America, figuring the bank is too big for the government to allow it to fail.
It's too late to cash out of the market, adjunct professor of finance at the University of Nevada, Jag Mehta, told the Review Journal. Investors who wanted to avoid the bloodbath should have sold stocks a year ago, Mehta said.
"At this point, if you're selling out now, you're guaranteeing a loss," said Reed Radosevich, president of Northern Trust Bank, which manages money for wealthy clients.
"We're not going to make big moves to try to time the market," Radosevich said. "If you are constantly moving money back and forth, you may miss a huge up day."
Lost in all the hoopla of the A.I.G. bailout and Lehman Brothers filing for bankruptcy was the failure of yet another regional bank this past weekend.
It happened in Nevada just one week prior to the Wall Street banking meltdown, though little was reported on the matter.
Nevada regulators shut down Silver State Bank, located in Henderson. It had $2 billion in assets and $1.7 billion in deposits as of June 30.
Silver State Bank has operated 12 branches in Nevada and Arizona as well as loan offices in Nevada, Utah, Colorado, Washington, Oregon, California and Florida.
There were about $20 million in uninsured deposits held in roughly 500 accounts at Silver State that potentially exceeded the insurance limit, the FDIC said.
Silver State had been the 11th failed bank so far this year and the list will continue to grow.
