3 ms·

>Given we have de facto uncapped the FDIC’s insurance limit, It was never capped in any hard manner, remember the fine print is "up to at least" $250,000.00.

>Given we have de facto uncapped the FDIC’s insurance limit, It was never capped in any hard manner, remember the fine print is "up to at least" $250,000.00. The limit can be as high as the FDIC's feeling that particular day, the only thing set in stone is the floor of $250,000.00.

JumpCrisscross 4y ago
> limit can be as high as the FDIC's feeling that particular day Technically, the FDIC has to find the failure to be systemically important. Legally, nobody defined what that process should be, so you are in practice correct.
zamnos 4y ago
In this case > All depositors of First Republic Bank will become depositors of JPMorgan Chase Bank, National Association, and will have full access to all of their deposits.
- pjc50 4y ago
  Indeed - the government isn't taking responsibility, they've leaned on the private sector to sort this out among themselves. (Matt Levine et al have argued that the SV VC community should have taken over more, or indeed any, of the rescue role, since they were responsible for overweighting SVB and then bankrunning it. But that hasn't happened)
  - JumpCrisscross 4y ago
    > the government isn't taking responsibility Ish. The loss-sharing transaction does involve the FDIC taking risk [1]. They claim they will settle up actual losses with special assessments on their members. And there may be no losses at all. But there is definitely risk being assumed by the FDIC, an entity backed by the full faith and credit of the United States. It also looks like the FDIC is providing JPMorgan with a $50bn term loan [2]. (Shout out to snake_doc [3].) [1] https://www.fdic.gov/resources/resolutions/bank-failures/failed-bank-list/lossshare/ https://www.fdic.gov/resources/resolutions/bank-failures/fai... [2] https://www.jpmorganchase.com/ir/news/2023/jpmc-acquires-substantial-majority-of-assets-and-assumes-certain-liabilities-of-first-republic-bank https://www.jpmorganchase.com/ir/news/2023/jpmc-acquires-sub... [3] https://news.ycombinator.com/item?id=35770684 https://news.ycombinator.com/item?id=35770684
    - aero-glide2 4y ago
      "The FDIC is not supported by public funds; member banks' insurance dues are its primary source of funding."
      - ceejayoz 4y ago
        The FDIC is not normally supported by public funds. If it ran out of money, it's nearly certain the government would step in to cover the shortfall.
0zemp2c 4y ago
> The limit can be as high as the FDIC's feeling that particular day, the only thing set in stone is the floor of $250,000.00. as long as the payout doesn't exceed the FDIC's funds its a $100 billion fund insuring $14 trillion in deposits...
- JumpCrisscross 4y ago
  > its a $100 billion fund insuring $14 trillion in deposits Backed by the full faith and credit of the United States. (As well as what looks like the Fed [1].) [1] https://bpi.com/the-mysterious-footnote-7-to-whom-and-on-what-terms-is-the-fed-lending-173-billion/ https://bpi.com/the-mysterious-footnote-7-to-whom-and-on-wha...
  - T-A 4y ago
    FWIW :/ https://www.usdebtclock.org/ https://www.usdebtclock.org/
    - ceejayoz 4y ago
      It's historically worth quite a bit.
      - T-A 4y ago
        True, but https://fred.stlouisfed.org/series/GFDEGDQ188S https://fred.stlouisfed.org/series/GFDEGDQ188S
        Kye 4y ago
        See that slide down after most people got checks and businesses got PPP loans they didn't have to pay back when the pandemic was at its worst? That's investment paying off. And that's with supply issues that continue to this day. Watch that space for when supply catches up and we start figuring out better pandemic management after the next killer wave. The road ahead is bumpy, but I see wise investments paying off as long as some idiot doesn't get into power and start cutting taxes for people who don't need them again. The people who keep loaning money to the government at least don't seem worried because they keep doing it.

JumpCrisscross 4y ago

> limit can be as high as the FDIC's feeling that particular day Technically, the FDIC has to find the failure to be systemically important. Legally, nobody defined what that process should be, so you are in practice correct.

zamnos 4y ago

In this case > All depositors of First Republic Bank will become depositors of JPMorgan Chase Bank, National Association, and will have full access to all of their deposits.

pjc50 4y ago
Indeed - the government isn't taking responsibility, they've leaned on the private sector to sort this out among themselves. (Matt Levine et al have argued that the SV VC community should have taken over more, or indeed any, of the rescue role, since they were responsible for overweighting SVB and then bankrunning it. But that hasn't happened)
- JumpCrisscross 4y ago
  > the government isn't taking responsibility Ish. The loss-sharing transaction does involve the FDIC taking risk [1]. They claim they will settle up actual losses with special assessments on their members. And there may be no losses at all. But there is definitely risk being assumed by the FDIC, an entity backed by the full faith and credit of the United States. It also looks like the FDIC is providing JPMorgan with a $50bn term loan [2]. (Shout out to snake_doc [3].) [1] https://www.fdic.gov/resources/resolutions/bank-failures/failed-bank-list/lossshare/ https://www.fdic.gov/resources/resolutions/bank-failures/fai... [2] https://www.jpmorganchase.com/ir/news/2023/jpmc-acquires-substantial-majority-of-assets-and-assumes-certain-liabilities-of-first-republic-bank https://www.jpmorganchase.com/ir/news/2023/jpmc-acquires-sub... [3] https://news.ycombinator.com/item?id=35770684 https://news.ycombinator.com/item?id=35770684
  - aero-glide2 4y ago
    "The FDIC is not supported by public funds; member banks' insurance dues are its primary source of funding."
    - ceejayoz 4y ago
      The FDIC is not normally supported by public funds. If it ran out of money, it's nearly certain the government would step in to cover the shortfall.

0zemp2c 4y ago

> The limit can be as high as the FDIC's feeling that particular day, the only thing set in stone is the floor of $250,000.00. as long as the payout doesn't exceed the FDIC's funds its a $100 billion fund insuring $14 trillion in deposits...

JumpCrisscross 4y ago
> its a $100 billion fund insuring $14 trillion in deposits Backed by the full faith and credit of the United States. (As well as what looks like the Fed [1].) [1] https://bpi.com/the-mysterious-footnote-7-to-whom-and-on-what-terms-is-the-fed-lending-173-billion/ https://bpi.com/the-mysterious-footnote-7-to-whom-and-on-wha...
- T-A 4y ago
  FWIW :/ https://www.usdebtclock.org/ https://www.usdebtclock.org/
  - ceejayoz 4y ago
    It's historically worth quite a bit.
    - T-A 4y ago
      True, but https://fred.stlouisfed.org/series/GFDEGDQ188S https://fred.stlouisfed.org/series/GFDEGDQ188S
      - Kye 4y ago
        See that slide down after most people got checks and businesses got PPP loans they didn't have to pay back when the pandemic was at its worst? That's investment paying off. And that's with supply issues that continue to this day. Watch that space for when supply catches up and we start figuring out better pandemic management after the next killer wave. The road ahead is bumpy, but I see wise investments paying off as long as some idiot doesn't get into power and start cutting taxes for people who don't need them again. The people who keep loaning money to the government at least don't seem worried because they keep doing it.