Bill Seeks $500 Billion for FDIC Fund

[marketcrazy1]

WASHINGTON -- Senate Banking Committee Chairman Christopher Dodd is moving to allow the Federal Deposit Insurance Corp. to temporarily borrow as much as $500 billion from the Treasury Department.

The Connecticut Democrat's effort -- which comes in response to urging from FDIC Chairman Sheila Bair, Federal Reserve Chairman Ben Bernanke and Treasury Secretary Timothy Geithner -- would give the FDIC access to more money to rebuild its fund that insures consumers' deposits, which have been hard hit by a string of bank failures. http://online.wsj.com/article/SB123630125365247061.html .............. 500 BILLION!! jesus christ! it`s as bad as I thought.

[burythehatchet]

1. Get ready for inflation, and if it can't be managed, Latin American style hyper-inflation

We will become the Banana Republic we chose to become in December of 2000.

[wtbymark]

2. the problem is...

that could only be a fraction of what they need

There's 250 Trillion $ of bad paper out there.
Our national GDP is 13-15 trillion.
Unfortunately, this is not going to stop untill that bad paper goes away.

[originalpckelly]

4. The FDIC's maximum liabilities are $4.6 trillion.

The reason they need money is that their fund is only $22 billion, or way less than 1% of their total liabilities.

If banks fail, and they have substantial numbers of deposits above the insured amount, and the FDIC cannot immediately recover their funds, the money supply will collapse and cause hyper-deflation.

[originalpckelly]

3. Instead of the greedy banks paying higher premiums into the FDIC fund...

they make us back it up. These people are a bunch of motherfuckers.

This also means there will be panics on the bank, because the issue of the FDIC not having enough money to pay for bank failures, will cause people to panic.

[originalpckelly]

5. By the way, I've been saying they couldn't possibly have enough money the past two days...

They only have enough money to cover less than 1% of their total liabilities.

[slipslidingaway]

6. Error: You've already recommended that thread. kick n/t