The FDIC is broke. No, I am not kidding. Look at their website where they show you exactly how much money they have. The deposit insurance fund balance is about $125 billion. That puts their reserve ratio at only 1.26%. That is right, 1.26% is the ratio of how much money the FDIC has versus all the bank accounts that they would need to bail out should they need to do so.
About $125 billion means they do not even have enough to bail out Silicon Valley Bank. But as we know, Silicon Valley Bank just got bailed out. So where is the money coming from? And according to the White House and everybody talking about this, it will not cost the taxpayer a dime. So how are depositors at these failed banks getting a free lunch?
Well, shocker, they are not.
Timecodes
0:00 Video Introduction
1:06 Bank Term Funding Program by Federal Reserve
1:41 Working of the Bank Term Funding Program
3:18 Banks’ Position in Today’s Market
4:51 Short-Term Borrowing Agreement and Collateral Value
6:17 Role of Federal Reserve in Collateral Valuation
7:15 Loan Procedure under Bank Term Funding Program
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#FDIC #BailoutMoney #Recession
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