We should probably just acknowledge that all bank deposits and deposits into money market funds are going to be fully insured by the government.
Yeah it's a bunch of bullshit, but it's way less bullshit to declare it upfront than pretending they aren't and then inevitably bailing them out when they fail. Acknowledge it, set up the fee structures accordingly, and move on.
The alternative is to actually follow the law. But if that were possible we would be doing it already, but we don't. So now what?
Here's a simple solution that I'm not sure why it's not already the standard: any bank that, in the assessment of the FDIC, would trigger a systemic failure of the banking system were it to collapse needs to insure all it's accounts.
We should probably just acknowledge that all bank deposits and deposits into money market funds are going to be fully insured by the government.
Yeah it's a bunch of bullshit, but it's way less bullshit to declare it upfront than pretending they aren't and then inevitably bailing them out when they fail. Acknowledge it, set up the fee structures accordingly, and move on.
The alternative is to actually follow the law. But if that were possible we would be doing it already, but we don't. So now what?
I think you’re right.
Ideally no bank should get a bailout when it fucks up. But that’s not the government we will ever have.
The only choice we have is : do we want megabanks decimating smaller banks?
Here's a simple solution that I'm not sure why it's not already the standard: any bank that, in the assessment of the FDIC, would trigger a systemic failure of the banking system were it to collapse needs to insure all it's accounts.
The FDIC would be bribed to make wrong assessments.
Great. Still benefits them. More bribes for the FDIC and less money banks control