US Banking system remains "sound and resilient"

@SusanInFlorida As I understand, banks pay insurance premiums to FDIC, so anyone doing business indirectly pays into the bailout money as part of using banking services. It's not really a taxpayer burden until FDIC runs out of money. And FDIC doesn't have to bail out the depositors until the bank owners' equity is exhausted. Banks become insolvent when equity falls below regulatory minimums, which should happen long before either FDIC or the taxpayers have to bail out the depositors.

@Heartlander banks do pay insurance premiums to the FDIC. The relationship of premium amount to loan risk isn't well established, though. The premium size seems more related to the size of the depositor base. customer with checking accounts typically don't cause failures. Bad loans do. But whenever the FDIC steps in and tries to scale back higher risk mortgages and commercial construction loans, politicians go nuts because this is "strangling the economy".

Even if you have NO risky loans, you can still die the blink of an eye. Silicon Valley Bank had (mostly) Treasury Bills in it's "asset" portfolio. very few actual loans. The problem was, when you need to sell a "T Bill", it's price may have gone down if the Fed raised interest rates after you bought it. So SVB bought EXACTLY what the government said to, and it was the cause of their demise. As cutomers pulled their deposits, they couldn't get rid of their T Bills to match assets and liabilities.

No FDIC bank risk examiner is going to down rate a bank for buying T Bills. Its what they constantly tell banks to do. Until Fed Funds increases turn them into cancer.

@SusanInFlorida Good.. You understand the situation then. The rich get covered and the poor get screwed. I can give you a couple of thousand words on how any insurance the bank carries will go the the board and shareholders and not the small dpeositers or front of house people. And the commercial end of those insurances will be paid for indirectly by the depositors. That just how business is American style.. And this worked fine as long as the toxic end of the stick could be held out to overseas investors. But that pyramid is collapsing before your eyes. The Hly dollar isnt so holy and people inside America are going to get stuck with the bill this time.. Guess which people🫵.. 😷

@whowasthatmaskedman when have i ever suggested otherwise?

and american taxpayers and citizens always get stuck paying for whatever happens.