4 ms·

> you should fix that how do you fix it?

toomuchtodo 3y ago
As an individual, spread deposits across accounts or institutions to stay within limits [1]. There are account products that will sweep your deposits across other institutions in order to ensure full coverage. Fidelity's cash management account will cover up to $5M using sweeps [2], for example. Mercury has a similar product for business accounts [3]. If you're a larger business (>$5M cash equivalents on hand), treasury management in government money market funds instead of a demand deposit account. All roads lead to mostly US treasuries here. [1] https://www.fdic.gov/resources/deposit-insurance/brochures/insured-deposits/ https://www.fdic.gov/resources/deposit-insurance/brochures/i... [2] https://www.fidelity.com/why-fidelity/safeguarding-your-accounts https://www.fidelity.com/why-fidelity/safeguarding-your-acco... [3] https://mercury.com/vault https://mercury.com/vault (previous comment on the topic during SVB failure: https://news.ycombinator.com/item?id=35171289 https://news.ycombinator.com/item?id=35171289)
- initplus 3y ago
  Splitting assets between banks doesn’t change the insurance income collected by FDIC, and nor does it change the overall risk profile for FDIC - its artificial structuring behaviour. It’s a minimum, not a cap.
  - toomuchtodo 3y ago
    Again, as my comment [1] mentioned, there are no hard limits. For FDIC to fail, the US government and it's largest member banks (including those considered globally systemic) would have to fail. There will be losses, but there will be no systemic failure. Properly titling and distributing deposits ensures you've met your obligation to meet deposit insurance requirements (although it might not matter such that happened with SVB depositors). You cannot control the regulatory mechanisms, but you can take somewhat straightforward, prudent measures to keep the paperwork you'll have to do and any interruptions to your finances to a minimum. If your risk model is the US government allowing FDIC to fail, we're well outside of reasonable discourse. Your currency would be food, fuel, and firearms. [1] https://news.ycombinator.com/item?id=39441532 https://news.ycombinator.com/item?id=39441532

As an individual, spread deposits across accounts or institutions to stay within limits [1]. There are account products that will sweep your deposits across other institutions in order to ensure full coverage. Fidelity's cash management account will cover up to $5M using sweeps [2], for example. Mercury has a similar product for business accounts [3]. If you're a larger business (>$5M cash equivalents on hand), treasury management in government money market funds instead of a demand deposit account. All roads lead to mostly US treasuries here. [1] https://www.fdic.gov/resources/deposit-insurance/brochures/insured-deposits/ https://www.fdic.gov/resources/deposit-insurance/brochures/i... [2] https://www.fidelity.com/why-fidelity/safeguarding-your-accounts https://www.fidelity.com/why-fidelity/safeguarding-your-acco... [3] https://mercury.com/vault https://mercury.com/vault (previous comment on the topic during SVB failure: https://news.ycombinator.com/item?id=35171289 https://news.ycombinator.com/item?id=35171289)

initplus 3y ago
Splitting assets between banks doesn’t change the insurance income collected by FDIC, and nor does it change the overall risk profile for FDIC - its artificial structuring behaviour. It’s a minimum, not a cap.
- toomuchtodo 3y ago
  Again, as my comment [1] mentioned, there are no hard limits. For FDIC to fail, the US government and it's largest member banks (including those considered globally systemic) would have to fail. There will be losses, but there will be no systemic failure. Properly titling and distributing deposits ensures you've met your obligation to meet deposit insurance requirements (although it might not matter such that happened with SVB depositors). You cannot control the regulatory mechanisms, but you can take somewhat straightforward, prudent measures to keep the paperwork you'll have to do and any interruptions to your finances to a minimum. If your risk model is the US government allowing FDIC to fail, we're well outside of reasonable discourse. Your currency would be food, fuel, and firearms. [1] https://news.ycombinator.com/item?id=39441532 https://news.ycombinator.com/item?id=39441532