> What makes this even worse, is that Yellen would have lost nothing had she said they would back every bank and not just large banks - small bank failures are

> What makes this even worse, is that Yellen would have lost nothing had she said they would back every bank and not just large banks - small bank failures are just not that common, and the risk is low, (and can be walked back in two years when the tension lowers). FDIC is supposed to protect smaller individual depositors, not gigantic companies with hundreds of millions of dollars in deposits. Gigantic companies have financial teams that should be tasked with protecting their operating capital. FDIC is also a last-resort. The idea is that bank assets are sold off and all depositors are made whole. It's very difficult and time-consuming to do this with a mega bank though. Maybe FDIC limits should be raised, but the problem with that is someone needs to pay for it. Perhaps companies with $100MM deposits should be paying for private insurance.