5 ms·

> Yes, the depositors would get bailed out, Above the 250k limit, that is not normally the case. The joint statement is creating a special situation here.

• danans 4y ago
  > Above the 250k limit, that is not normally the case. The joint statement is creating a special situation here. Yes, the special situation will likely become the new normal. There will be pressure to reintroduce the Dodd-Frank stress tests that the Trump administration (with the help of many banking-industry-aligned Democrats) eliminated in 2018 for banks with < $250M in deposits, and there will be greater insurance required on deposits. Just 4 years after that change, the lessons of 2008 will have to be relearned.
  • DubiousPusher 4y ago
    > There will be pressure to reintroduce the Dodd-Frank stress tests that the Trump administration Can't they just up the capitalization requirements and get the same effect with far less red tape and billable hours for consultants and lawyers?
    • danans 4y ago
      IANA-Economist, but I believe the reason that capitalization requirements aren't sufficient is because of the "Last Taxi Problem", described in this article: https://www.clevelandfed.org/publications/economic-commentary/2020/ec-202005-evolution-bank-capital-requirements https://www.clevelandfed.org/publications/economic-commentar...