funds Wrote:
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> The FDIC has a huge reserve for this type of
> scenario.
Yeah, for a handful of major banks. But if this becomes a problem across the system, you will be looking at an S&L style bailout using more tax dollars.
The reason this bank failed is it was
> giving out loans without checking the borrowers
> credit history, ect.
You don't think virtually ever lender was doing this during the housing boom? These idiots wanted de-regulation. They got it. And they blew it!
So its hard to blame the FDIC
> for them failing.
No one was blaming FDIC. I was pointing out that the bank was insolvent, so all these withdrawals are pulling dollars out of FDIC's coffers.
The other reason it was failing
> is because some body released information that
> they where having trouble and account holders
> quickly withdrew like 1 billion dollars...
I agree Schumer shouldn't have said that. But he isn't to blame for the bank's sorry condition.
The
> FDIC keeps it all quit and if somebody else spills
> the beans than thats their fault... So dont worry
> the FDIC has plenty of money to protect your
> accounts
I'm sure people used to say the same thing about FSLIC back in the 80s....
http://en.wikipedia.org/wiki/FSLIC