3 ms·
> Only 3% of deposits in the bank are FDIC insured why is that?!
by jb1991 4y ago
> Only 3% of deposits in the bank are FDIC insured
why is that?!
- synu 4y agoBecause the insurance is for $250k and most depositors had much more than that.
- NordSteve 4y agoBecause most of their depositors were business that kept >$250K (the insurance limit) in the bank.
- tome 4y agoWhy would someone keep more than $250K in bank deposits? Isn't it more prudent (looking back no more than 15 years) to keep T-Bills or some other liquid security that isn't subject to a bank run?
- blibble 4y ago$250k isn't much for a company with employees you have to keep some cash somewhere to meet short term expenses (like payroll)
- tome 4y agoIs it not possible to meet short term expenses with a short term loan which is discharged over a few days by selling liquid assets? Maybe banks just don't want to let you do that.
- SpicyLemonZest 4y agoIt is, and no prudent company should have lost their entire war chest unless their funding arrived just yesterday. But when you're spending $10M or $100M a year, it's operationally challenging to make sure you never have more than $250K in the bank while you're doing it. (It's much, much better to be imprudent and have too much in bank deposits than miss payroll because you have too little.)