Sometimes an apparently sound security system turns out to have a fatal flaw that not only leaves your system insecure, but lulls you into a false sense of security.
Passwords are the tried and true way of securing computer systems.
There are four major possible problems with passwords, any one of which may render your entire password system useless. More than enough to protect your precious data. Database passwords are known to every programmer who's ever had to work on a program that accesses the database. This problem is even worse for users of vendor-supplied packages. A person who's worked with the package in one company can go to a different company and know the database passwords.