Remember that scene at the beginning of It’s a Wonderful Life, where people are all desperately trying to get into the bank because if it fails before they get in, they lose their money? That’s what the FDIC prevents.
This post uses a gift link which may have a view count limit. If it runs out, there is an archived copy of the article available
MAGAts talk about Trump Derangement Syndrome but “conservatives” are still trying to destroy everything FDR helped create. That’s how far the FDIC goes back. This is why they want to do away with physical cash. Can’t have a run on a bank if your electronic money just suddenly disappears.
Its the setup to the biggest robbery in history!
Calling it now.
2026 with the economy in free fall and the Republicans about to be voted out of office, he will make his move to fully seize control and declare martial law to stop elections.
The moves they are talking about will absolutely destroy the economy and plunge us into the abyss.
I don’t care anymore, let it crumble.
Man I beat you to that by at least a month.
I guess the positive is that if the economy is that fucked they might not have the money to resist the guillotine crazed hordes. Personally I think an ill measured rope would be the best method
I’m looking at the positive side of societal collapse. If there are no banks, then I don’t have to pay my mortgage.
Don’t worry, someone will buy that debt from the bank. You’ll still get to pay.
Worst case. Inflation eats the mortgage until it’s just chump change.
There’s no way that happens without full on revolt.
I might have said something like that 8 years ago but now ¯_(ツ)_/¯
A little bullshit story from Trump and Fox about how our tax dollars insure other people’s bad decisions and it’s toast.
\
They did paste it correctly but in Markdown, you have to type three. The first one escapes the second, and the third one escapes the underscore and prevents the pair from becoming an italics flag.
1: ¯_(ツ)_/¯
2: ¯\(ツ)/¯
3: ¯\_(ツ)_/¯
I said that a few freakouts ago, bud.
How does this relate, if at all, with the insurance that the NCUA provides?
Remember that scene at the beginning of It’s a Wonderful Life, where people are all desperately trying to get into the bank because if it fails before they get in, they lose their money? That’s what the FDIC prevents.
Yeah. FDIC insurance is the only reason each of us will be left with up to 100k if our banks go under. And most of us have less than 100k in savings, so it’s basically the US government saying
Don’t worry, even if shit hits the fan, you will still have your money.
I can’t even be bothered to hear how his minions are going to defend this one. It’s indefensible.
It’s 100k per account per bank, IIRC
You did not remember correctly. This is disclosed on every savings account with a bank that is insured by the FDIC. The limit was raised several years ago.
Sounds like I remembered correctly, although my information was outdated
Which makes the information incorrect.
Yes, the information I remembered was correct and outdated for the memory. However, that doesn’t change the fact that it’s incorrect right now. It doesn’t mean I recalled incorrectly
What backs or guranteed the FDIC?
That’s a little hard to parse, but if you’re asking “What guarantees the FDIC has the money to pay back Americans who lose their savings because of a bank collapse?”: The FDIC does. From https://www.fdic.gov/about/what-we-do:
The FDIC receives no Congressional appropriations - it is funded by premiums that banks and savings associations pay for deposit insurance coverage. The FDIC insures trillions of dollars of deposits in U.S. banks and thrifts - deposits in virtually every bank and savings association in the country.
FDIC insurance is a selling point for many retail banking products (like checking and savings accounts), so those institutions pay for the insurance so people will have confidence to bank there. More importantly, they buy it because it’s required by law currently.
If the FDIC were abolished, the void would be filled by unregulated entities that would charge higher premiums and cover less, and there would probably be kickbacks involved - while the government watches with its popcorn - to disincentivise real free market competition.
That’s if there were any kind of deposit insurance at all, I mean. The idea might be to encourage the American people to put their savings into a form they can retain control over - like precious metals, land, or digital currencies.
There’s also an implicit guarantee that the federal government would step in an make deposits good if there were a bank failure large enough to wipe out the FDIC
They won’t defend it. They have torn out their ear drums to criticism. They will hear no evil about the man.
Please be aware folks, the FDIC only has one percent of the money needed to back up their guarantee. I repeat, that’s one percent. A single big bank failure would probably wipe out the FDIC entirely and not everybody would get their money.
You shut your fucking mouth about the FDIC. They are 100% industry funded, they supported Americans through the financial crisis so none of them lost a dime from failing banks, they effectively regulate a large number of banks to remediate financial stress before it results in a loss, and they have never taken a dime of taxpayer money.
And they don’t need to hold 100% of the cash in banks, do you hear yourself with how stupid that is? They model how much cash they need from premiums to hold in reserve and they are very effective at it. Also, if losses increase they can levy a special premium on banks to shore up their liquidity position like they did in the financial crisis.
The FDIC actually has a podcast series about how they managed the financial crisis in case you want to educate your ignorant ass. I taught a whole segment in it when I taught Commercial Banking.
^^^
Funny considering the number of bank failures that have occurred without this happening.
Small failures, yes. If a wells fargo or jpmorgan failed…
Or a Washington Mutual?
I know wamu was a big failure but i dont know much about how it was handled. I heard a lot about Lehman Brothers, but that was an investment bank. So that’s different.
If you don’t know, then just stop commenting. You are way out of your depth here.
I mean…
A single big bank failure would probably wipe out the FDIC entirely and not everybody would get their money.
So that’s false.
I have no idea just how much was insured at Washington Mutual, and I have no idea what the position of the FDIC was at the time. I literally know nothing about that era.
Probably shouldn’t be making sweeping claims then.
Not even remotely true. In the 2008 financial crisis, between 2008 and 2012 , there were nearly 500 bank failures, and more than a trillion in assets involved and the FDIC covered every cent labeled to be covered.
So Trump’s solution is to just get rid of it? Seems irresponsible.
Decisions that make no fucking sense and Trump, name a more iconic duo.
Oh, I have no opinion on the political side of the article. I’m just saying that the FDIC has 1% of what they claim to ensure. Many people are absolutely reliant on the FDIC in case their bank were to ever fail. And that’s not a particularly fantastic idea.
And exactly how much do said banks have on hand to cover deposits? If there is no FDIC then banks should be required to have 100% of the required liquid cash to cover all deposits.
I agree. Banks should never lend people’s money unless those people specifically agree to have their money lent out. A bank should not be legally allowed to lend out your money and then say that you can come get your money whenever you want because it’s not true. If the bank specifically tells you that this product will lend your money out and that you cannot retrieve your money for X amount of time, that’s fine. That tells you the consumer that your money will be unavailable for this amount of time. And that makes you make the decision as to whether you can deal with that or not. If you can’t, you don’t use that product and don’t lend out the money.
No, that’s actually a pretty reasonable idea. Given that they’ve never lost a cent of money, can take more from the other banks if they need to, and are ultimately backed by the people who print the money.
You don’t understand insurance or how the FDIC works.
So it sounds like you do have an opinion…? How can you say that you don’t have an opinion “on the political side” of things, and the in the next sentence give your opinion? Just… what?
On what basis? You are way out of your depth. I’m sorry, but you have no clue what you’re talking about. See my prior comment
This will isolate american banks on the long run. Who wants to make business with Keenan Brothers 2.0 (on an international scale)… or did I miss something?
How does this spin to customers?
Okay, my checking account is no longer guaranteed in the event of your inevitable ambition-related collapse. Are you going to pay me speculative-investment class interest rates to justify me trusting you with the money? Or should I just go back to notes under the mattress?
Trump, probably, after talking to his new bestest advisor:
Just move all your money into Dogecoin. It will be perfectly safe there.
It’s easy to fight inflation in 2025.
Gold, guns and moonshine.
We still have bank failures now, Silicon Valley bank? Why eliminate it?
If you haven’t noticed elon wants to grift crypto via the government so by eliminating oversight and forcing people to run the bank, guess what kinds of assets people will dump their digital dollars into?
I’m guessing because 1) dumb ideological reasons involving cutting every government service that isn’t the military or immigration enforcement and 2) FDIC is primarily funded by fees from the banks. Consumers are so detached from how stuff works for the most part that removing the FDIC insurance fee wouldn’t give consumers higher interest rates, but just decrease the banks expenses and make them more money.
