Remember that scene at the beginning of It’s a Wonderful Life, where people are all desperately trying to get into the bank because if it fails before they get in, they lose their money? That’s what the FDIC prevents.

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  • shortwavesurfer@lemmy.zip
    1121·
    10 days ago

    Please be aware folks, the FDIC only has one percent of the money needed to back up their guarantee. I repeat, that’s one percent. A single big bank failure would probably wipe out the FDIC entirely and not everybody would get their money.

    • Twentytwodividedby7@lemmy.world
      28·
      9 days ago

      You shut your fucking mouth about the FDIC. They are 100% industry funded, they supported Americans through the financial crisis so none of them lost a dime from failing banks, they effectively regulate a large number of banks to remediate financial stress before it results in a loss, and they have never taken a dime of taxpayer money.

      And they don’t need to hold 100% of the cash in banks, do you hear yourself with how stupid that is? They model how much cash they need from premiums to hold in reserve and they are very effective at it. Also, if losses increase they can levy a special premium on banks to shore up their liquidity position like they did in the financial crisis.

      The FDIC actually has a podcast series about how they managed the financial crisis in case you want to educate your ignorant ass. I taught a whole segment in it when I taught Commercial Banking.

      • shortwavesurfer@lemmy.zip
        39·
        9 days ago

        Oh, I have no opinion on the political side of the article. I’m just saying that the FDIC has 1% of what they claim to ensure. Many people are absolutely reliant on the FDIC in case their bank were to ever fail. And that’s not a particularly fantastic idea.

        • ricecake@sh.itjust.works
          6·
          9 days ago

          No, that’s actually a pretty reasonable idea. Given that they’ve never lost a cent of money, can take more from the other banks if they need to, and are ultimately backed by the people who print the money.

          You don’t understand insurance or how the FDIC works.

        • raynethackery@lemmy.world
          3·
          9 days ago

          And exactly how much do said banks have on hand to cover deposits? If there is no FDIC then banks should be required to have 100% of the required liquid cash to cover all deposits.

          • shortwavesurfer@lemmy.zip
            12·
            9 days ago

            I agree. Banks should never lend people’s money unless those people specifically agree to have their money lent out. A bank should not be legally allowed to lend out your money and then say that you can come get your money whenever you want because it’s not true. If the bank specifically tells you that this product will lend your money out and that you cannot retrieve your money for X amount of time, that’s fine. That tells you the consumer that your money will be unavailable for this amount of time. And that makes you make the decision as to whether you can deal with that or not. If you can’t, you don’t use that product and don’t lend out the money.

        • prole@lemmy.blahaj.zone
          2·
          9 days ago

          So it sounds like you do have an opinion…? How can you say that you don’t have an opinion “on the political side” of things, and the in the next sentence give your opinion? Just… what?

    • ricecake@sh.itjust.works
      7·
      9 days ago

      Not even remotely true. In the 2008 financial crisis, between 2008 and 2012 , there were nearly 500 bank failures, and more than a trillion in assets involved and the FDIC covered every cent labeled to be covered.