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If all deposits were be covered then I doubt there would have been a run at all. But, Banks pay for FDIC Insurance, the money has to come from somewhere. Eith
by jmclnx 4y ago
If all deposits were be covered then I doubt there would have been a run at all.
But, Banks pay for FDIC Insurance, the money has to come from somewhere. Either the Tax Payers will pay via higher fees or interest rates to the Banks or via higher Taxes to the Fed.
All this means is people with large deposits will be covered directly by the Tax Payer, it is just a matter of who we pay.
- drdec 4y agoI agree about the fact it costs money to do this. But doing it after the fact is the worst way to do it - it is the most expensive way and also least effective in terms of preventing runs. So as long as we are going to pay for it anyway, let's at least get the most benefit, which would also, in a happy coincidence, be the least expensive.