The end-of-the-world scenario supposedly foretold by the Mayans has been somewhat of a running joke by many, but with things like this sometimes the best advice is not to tempt fate. Despite the wisdom of restraint, it seems we are tempting fate all over the place. We all know that the fiscal cliff—the date the massive Bush era tax cuts expire and automatic spending cuts negotiated (or more accurately, not negotiated) by Congress kick in—is nearing at yearend.

Of course, this comes after the presidential election to end all elections will be in the books, but before the winner is inaugurated. Many of us are tired of the apocalyptic rhetoric accompanying this year’s presidential election. Despite the rhetoric, the differences aren’t so stark, and neither side is offering much new.

A recent report from Pimco points out that the end of 2012 also brings with it another significant event. As one of the emergency actions following the credit meltdown of 2008, the Federal Deposit Insurance Corporation (FDIC) provided unlimited insurance coverage on demand deposits—first initiated as the Temporary Liquidity Guarantee Program and later codified under Dodd-Frank as the Dodd-Frank Deposit Insurance Provision—that will expire on Dec. 31, 2012.

Pimco Portfolio Manager Jerome Schneider says the expiration by itself may not be a game changer but that “it adds to the uncertainty that looms over short-term liquidity strategies as global interest rates continue to be squeezed.”

Just what the markets need: more uncertainty.

While this could be pushed down the road, like much of the fiscal cliff has been, it would require Congressional action, and we know how efficient that process has been.

Schneider’s report estimates that more than $1.4 trillion in bank deposits will be affected. In other words, $1.4 trillion of what had been risk-free assets, becomes risky.

The report set a cautious tone and warns it could create a negative interest rate scenario, but there seems to be a positive to this as well. Given the volume and scope of banking irregularities and outright fraud of late, there is something appealing about a guarantee, and as guarantees go, the FDIC is probably the best you can hope for. So it is understandable that in a relatively low inflation environment that folks would choose to keep money under this proverbial mattress.

But once this guarantee is lifted, that $1.4 trillion could be put to more productive use.

Daniel Petree, managing director of the Cornerstone Investment Management enhanced cash management funds sees opportunity.  He says the guarantee made it easy for institutions holding large cash deposits in these accounts to do nothing, but it doesn’t make much sense to earn nothing—or perhaps a negative rate—on money that is at risk.

Schneider points out that the European Central Bank’s move to cut its deposit rate on excess reserves to 0% has led to Treasury bills trading at negative yields. He says the likelihood of the U.S. Federal Reserve following suit is remote but not out of the question, which is scary especially given that there will be no guarantee beyond $250,000 after Dec. 31.

Who would have guessed that that keeping money under your mattress would be a better option than with a bank. Talk about your end-of-the-world scenarios.