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Might be a basic question from a STEM nerd with not a lot of finance background, but what are "insured" millions held in? Special class of corporate accounts?
by caycep 4y ago
Might be a basic question from a STEM nerd with not a lot of finance background, but what are "insured" millions held in? Special class of corporate accounts?
- selectodude 4y agoThe bank (every single bank) pays the FDIC a fee on every insured bank account. The FDIC puts all that money into a bucket and pays out from it whenever a bank fails. They also have a line of credit with the Federal Reserve that they can draw on if the bucket isn't large enough. So the FDIC pays out everybody up to $250k, closes the bank, liquidates the assets, and then pays out the balances above $250k until they run out of money.
- rashkov 4y agoSweep accounts, is one answer I’ve seen floating around
- rashkov 4y agoSome other suggestions here, for personal account holders who are fortunate enough to have that much cash: https://archive.ph/tyCy5 https://archive.ph/tyCy5