Blogs -Where the I/O Fund Holds Cash When Banks Keeps Failing

Where the I/O Fund Holds Cash When Banks Keeps Failing

April 20, 2023


Knox Ridley

Portfolio Manager

Amidst the growing skepticism in our banking sector, we thought it would be helpful to introduce an alternative way to both protect and diversify one’s assets. The information below discusses a method the I/O Fund uses to hold its cash, which is safer than banks, and yields 4.5% or higher.

The I/O Fund is an actively managed portfolio. We are not financial advisors, rather we discuss openly and in great detail what we are doing with our money through weekly webinars and real-time trade alerts. This has led to 174% better returns compared to Ark and results that are double the Nasdaq in the same time period.

Banks failing presents a new problem for investors, which is where to hold cash. We shared our thoughts on Treasury Direct accounts with our premium members last month, where we explained that opening a TreasuryDirect account allows anyone to directly purchase savings bonds and Treasuries (Notes, Bonds, Bills, TIPS, and FRNs) directly from the U.S. government.

This offers an option that is outside of the banking system, offers a decent yield, and is very liquid. This article is offered as a guide that will walk you through the process of opening a TreasuryDirect account and how it can potentially help secure your cash in these uncertain times.

Below is a brief video clip from our premium webinar. For more detailed information, please reference the article below.

More Concern in the Financial Sector & Why Having a Plan for Cash is Important

The current news cycle and media narrative suggests that it’s just regional banks that are facing challenges due to interest rate risk and depositors withdrawing funds to go to larger "too big to fail" banks. However, taking a closer look at the charts reveals that the situation may be more complex and not limited to just U.S. regional banks.

This is what appears to going on in Financial Sector in the US (XLF), which is comprised of the largest and most recognizable financial institutions in the US.

I/O Fund XLF chart

After breaking down from a bear pennant, we have a clean 5 wave drop from the February high. Until XLF can reclaim the $36 region, which is about 8.5% from current prices, then risk remains high.

International banks like the Royal Bank of Canada ($RY) also are exhibiting similar ugly trends. In fact, warnings are present in most major banks around the world. Here are some quick bullet points:

  • Japanese banks Mitsubishi UFJ Sumitomo and Mitsui Financial are down 15%-17% since March 9th.
  • The Commonwealth Bank of Australia is down ~12% since March 14th, and HSBC in England is down ~14% since late February.
  • Itaú Unibanco, Brazil's top bank, is down ~18% since last November.
  • Deutsche Bank is down another 21% from it January high, while the largest bank in France, BNP Paribas, is down 14% from its February high.

It appears that the risk doesn’t stop at the regional bank level but is international as well. Global banks are facing significant challenges, and it is unlikely the banking problems are over.

I/O Fund Royal Bank of Canada chart

The Royal Bank of Canada ($RY) looks a lot like some of the bigger banks in the US.

An Alternative Solution to Uncertainty: A TreasuryDirect Account for an Extra Layer of Security

To tackle potential issues in the banking sector, we are taking a proactive approach with some of our cash. We are purchasing T-Bills directly from the U.S. government through a TreasuryDirect account, eliminating counter-party risks with banks. If the banking situation deteriorates or becomes systemic, funds in these accounts remain safe and secure.

The Appeal for T-bills vs. Bonds

Investing in four-week T-bills might be the prudent choice in this situation, as they carry no default risk compared to bonds and do not tie up your cash for a long period of time. As an example of what to expect, the four-week Treasury bill rate is around 4.5%, compared to 0.15% last year. This is much higher than the long-term average of 1.22%.

Sign up for I/O Fund's free newsletter with gains of up to 221% - Click here

It is true that the U.S. government has never defaulted on its federal debt, which includes the umbrella of Treasury bonds, bills, and notes. However, it is also true that countries around the world default on their debt obligations, either partially or entirely, all of the time. We saw Iceland default on their external debt in 2008, and even recently Argentina defaulted on their sovereign debt in 2020 smack dab in the middle of the pandemic. In the event that the U.S. defaults on its debt, it’s speculated that T-bills are safer then bonds because of their shorter-maturity periods, lower interest rate risk, higher liquidity, and general overall market perception.

Opening a TreasuryDirect Account: A Step-by-Step Guide

Here is a link to a video that we gave to our premium subscribers, where I go throguh step-by-step on how to open a TresuryDirect Account.

TreasuryDirect Account

1. Visit the TreasuryDirect website: Navigate to the official TreasuryDirect website ( and click on "Open An Account."

2. Choose account type: Select the appropriate account type (individual, entity, or minor) and fill out the online application form: this essentially like a brokerage account with the government, so you will need your Social Security Number (SSN), email address, and bank account details.

3. Create a password and security questions: Choose a strong password and security questions to ensure the security of your account… this account will hold your cash and security should be prioritized just like your bank account ect.

4. Simply review and submit: Double-check the information you filled-out and submit the account application.

5. Check your email for a confirmation message from TreasuryDirect and follow the instructions to verify your account and email address.

6. Access your account: Use your account number, password, and the one-time passcode sent to your email to log in to your TreasuryDirect account.

7. Purchase bonds and T-bills: Once logged in, navigate to the "BuyDirect" tab and select the desired security type (T-bills, notes, bonds, etc.). Follow the on-screen instructions to complete your purchase. 

Lessons from the 2008 Crisis: “History never repeats itself, but it does often rhyme.”

The 2008 financial crisis exposed the banking system's fragile backend to the public in a fast and violent sweep, catching many people unprepared. Most people had no idea what fractional banking was, nor how complex their banks had become. These banks have only grown in size and complexity since.

We rely on banks to store money, but it does come with some risks. When a bank fails, individuals can depend on government-backed insurance (FDIC) to recover their deposits and restore stability in our banking system. However, this process can be lengthy and challenging. As we saw in 2008, no one wants to wait on a Gov’t backed insurance timeline to get money back that they thought was being safely stored in a bank account.


Considering the current risks within the banking sector, going through the process of opening a TreasuryDirect account offers a safe alternative for people to store their cash in. This guide was written to help you navigate the process of buying Treasury marketable securities and really to show just how simple it is to get started securing your cash with bonds and T-bills. It is important to stay informed and protect what you have worked hard for, we wanted to shine light on something we felt hasn’t gotten enough spotlight in the investment world.

What’s Next:

This Thursday at 4:30 pm Eastern, I will be holding a webinar for premium Tech Insider Network members to discuss how I plan to navigate the broad market, as well as various tech entries including Tesla. We offer trade alerts plus an automated hedging signal. In addition, we are an audited portfolio with 174% better returns than Ark and are results are double the Nasdaq in the same time period.

We identified a strong buy signal in Bitcoin in December, and we also identified Nvidia's (NVDAbottom in October. Bitcoin is a leading asset YTD in the market, and Nvidia is the leading stock in the S&P 500. We take gains often and we discuss this in our weekly webinars and on our premium site, one of which is scheduled for next Thursday, April 27th.

Recommended Reading:

Bitcoin Vs Banks: Here's Where the Price Goes Next
Banks, Inflation, and One More Low
The Importance of Verified Returns and Risk Management for Retail Investors
Bitcoin is up 40% in 2023, Here’s Where it Goes Next

Gains of up to 403% from our Free Newsletter.

Here are sample stock gains from the I/O Fund’s newsletter --- produced weekly and all for free!

+344% on Nvidia

+403% on Bitcoin

+218% on Roku

*as of March 15, 2022

Our newsletter provides an edge in the world’s most valuable industry – technology. Due to the enormous gains from this particular industry, we think it’s essential that every stock investor have a credible source who specializes in tech. Subscribe for Free Weekly Analysis on the Best Tech Stocks.

If you are a more serious investor, we have a premium service that offers lower entries and real-time trade alerts. Sample returns on the premium site include 324% on Zoom, 601% on Nvidia, 445% on Bitcoin, and 4-digits on an alt-coin. The I/O Fund is audited annually to prove it’s one of the best performing Funds on the market with returns that beat Wall Street funds. 


More To Explore


Where the Market is Headed Next

Where the Market is Headed Next

When the market was selling tech last year, the I/O Fund was buying AI leaders. For example, from September 2021 through January of 2023, we initiated 9 buy alerts for NVDA below $210. The last two al

June 08, 2023,format

Apple Bets On The Emerging Markets Growth Story

The smartphone market continues to be hit hard in q1, with prices down 20% and shipments down 13%, according to Canalys. Despite double digit decline across the industry, Apple delivered marginal grow

June 05, 2023
Nvidia Will "Still" Surpass Apple's Valuation

Nvidia Will “Still” Surpass Apple’s Valuation

My coverage on Nvidia as an AI leader began in 2018 (yes, really – five years ago). Since then, I’ve covered the AI microtrend for this specific stock 27 times on my research site, which is the equiva

May 29, 2023
FAAMG Stocks Trading At Precarious Valuations

FAAMG Stocks Trading At Precarious Valuations

The mega-cap stocks that are known as FAAMG reported earnings recently. These names are driving the market higher, especially Microsoft and Apple. In fact, the percentage of Microsoft and Apple’s comb

May 15, 2023
Apple PC Screen

Apple’s Stock In Focus: More Profitable Than Banks

Investors looking for the “next big thing” will point toward companies like Stripe, Sofi or Square as the leading fintech stocks. Meanwhile, the next big thing to disrupt the financial sector may be s

May 04, 2023
Netflix Remote Control

This Stock Price For Netflix Is A “Buy” For 2023

In April of 2022, Netflix surprised the markets by reporting its first subscriber loss in nearly 10 years. The stock tumbled 35% the following day, as investors panicked. Famed hedge fund manager, Bil

May 03, 2023
Where the I/O Fund Holds Cash When Banks Keeps Failing

Where the I/O Fund Holds Cash When Banks Keeps Failing

Amidst the growing skepticism in our banking sector, we thought it would be helpful to introduce an alternative way to both protect and diversify one’s assets. The information below discusses a method

April 20, 2023
Tesla Building

Tesla Stock: What You Need To Know About Q1 Earnings

Two months ago, we wrote that after realizing gains of 31%, it was time to take a time out on Tesla at the $208.31 price when our firm stated: “Right now, our technical analysis is at odds with our fu

April 16, 2023
Bitcoin Vs Banks: Here's Where the Price Goes Next

Bitcoin Vs Banks: Here's Where the Price Goes Next

The recent decoupling of Bitcoin from equities, we believe, is the start of a new uptrend that appears to be inversely correlated to the financial sector. The financial media would have us believe tha

April 05, 2023
Official Press Release: I/O Fund's Cumulative Returns Double the Nasdaq Following a Tough 2022

Official Press Release: I/O Fund’s Cumulative Returns Double the Nasdaq Following a Tough 2022

Actively managed portfolio and research site announces its largest cumulative lead over institutional all-tech portfolios. The I/O Fund defies a challenging market, outperforming peers and providing i

March 30, 2023

Sign up for Analysis on
the Best Tech Stocks
The I/O Fund specializes in tech growth stocks and offers in-depth research for Premium Members. Investors get access to a transparent portfolio of 30 positions, a private forum, webinars, and real-time trade notifications. Sign up for Premium.

We are on social networks

Copyright © 2010 - 2023
Get Free Weekly Analysis on the Best Tech Stocks