They are surgeons, lawyers, engineers, doctors. It's FDIC -insured. So there are certainly investment opportunities that you can get way more than 4% at, but anything above that
And so we've actually seen this happen in practice. So the FDIC , again, very poorly capitalized. Just like normal banks are too.
interesting uh situation so you think about the federal government you think about Washington DC you think about government agencies whether it's the se you know SEC or FDIC or whoever um the FED Reserve uh was really created in the midst of a long and um unsuccessful
That's what we're working with. And it's really-- FDIC ? split their money between different accounts so that none of them was above the limit.
Interestingly, during the 9/11 attacks, the FBI was certain the terrorists said, "Use this to exchange all of their value, " when, in fact, they had used an FDIC -insured bank in Florida. And the reason that this happens is that no one who works in Hawala, no Hawaladar, is going to trade money for terrorists because that's
development deal and I'm going to pay myself a nice fee and if the development deal goes south I don't care because the SNL is federally insured FDIC Insurance not my problem in addition the government allowed the snls
You could leave $150,000 in chips on a card table, walk away, take a piss, and come back to find your money untouched, as if it had been insured by the FDIC . Try doing that a Google party.
David Wessel: Yes, they should. Right? But, that's one of the things that's kind of frustrating about this. They were sophisticated people. The same way that the FDIC can go in and take care of a failing bank.
been um layoffs, downsizing um then the bank failed altogether. Then they were owned by the FDIC . Uh then they were owned by another bank and then another bank and then Wayne.
Because in the Great Depression, all the banks failed. And so they created this thing called the FDIC , the Federal Deposit Insurance Corporation. So you guys are probably familiar, right now, if you put your money in a bank, it says $250,000 are insured by the FDIC .
they failed in rapid succession. And there was actually sister insurance corporation to the FDIC that was the Federal Savings and Loans Insurance Corporation, and that immediately was like, holy crap, we don't have the money to save a fraction of these banks.
The government's got your back. Well, the unfortunate thing is the FDIC is actually just as underfunded as banks. In fact, more so.
billion in in charges so they're still they've written down their assets on on this stuff like 50 million dollar and we fact that the reason that they were getting Reckless with lending was because they were FDIC insured and had nothing to lose because the government
This regulation, by the way-- Basel II-- was not implemented in the US except, guess what, for the investment banks, the same investment banks that got into the most trouble. It was the deposit institution because Sheila Bair, who was the head of the FDIC , didn't like those risk weights. They basically kept them from manipulating these risk weights and playing with the models of these risk weights to get the equity as low as they could get away with.
and spread over everything um and uh what what what the theory would suggest president that was a pretty major change that scared a lot of people and he created the FDIC Deposit Insurance the Securities
And so they created this thing called the FDIC , the Federal Deposit Insurance Corporation. So you guys are probably familiar, right now, if you put your money in a bank, it says $250,000 are insured by the FDIC . And this gives you some veneer of, like, safety.
It goes into operation without anyone knowing it. So for instance, when Nevada went under, the banks of Nevada were salvaged immediately by the FDIC , not by the state government of Nevada going to Paris and to Berlin and to Washington cap in hand begging for funds to save its banks.
Banks can't kind of go through that. So no matter how I'm involved in the effort, it's part of the reform to have the FDIC , the Federal Deposit Insurance Corporation, take down JP Morgan-- good luck to all of us if that happens.
split their money between different accounts so that none of them was above the limit. If you have, if you're with a partner, you have up to $2 million of FDIC insurance. And it's across four types of accounts.
I see some heads shaking. Yeah? Make sense? Okay. So we have to learn how to get out of it. Now, here's what I see happening today in this economy. We call it the "FDIC .” It's kind of an insurance policy if you begin to look at this.