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Originally Posted by guyy
Of course, we owe the FDIC to New Deal interference in the market place. If those dumbass depositors were smarter, they would have done their homework and stashed their cash in a better bank. They're being rewarded for failure.
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It is called "insurance", which is different than rewarding failure. Buying insurance and paying a premium to manage risk is a good thing in my view.
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Anyway, banks never have enough money to cover a panic.
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That is why the Federal Reserve lends money to banks - to cover their short-term needs.
I am not sure where you want to go with this, but my point is that there are safe-guards in place. the folks in Washington panicked and for some reason would not allow the system to work. So you had failed institutions that assumed too much risk going to Washington asking for a "bailout", they sell a story that the world would end if they failed, Washington bought in to it, the banks who got "bailed" were put in position to laugh all the way to the "bank" with big bonuses and all at tax payer expense. Washington in a way got suckered. Obama assured us that controls were in place, he was wrong or he lied. Now he lumps the good with the bad.