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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The bank bailouts of 2008 and 2009 are still fresh in the minds of many Americans. The government agreed to bail out large banks with taxpayer money, a decision that sparked controversy and debate. The question that remains on many people’s minds is, who is really paying for the bank bailouts?
At the time of the bailouts, the government argued that rescuing the banks was vital to helping the overall economy. The banks played a critical role in the financial system, providing loans and access to credit for ordinary citizens and businesses. However, the public felt that the banks should have been held accountable for their poor decisions and mismanagement, rather than receiving a financial lifeline.
In reality, the government did use taxpayer money to assist in the bailout of the banks. The Troubled Asset Relief Program (TARP) was established by the government to provide financial assistance to banks in need. The program was funded using taxpayer dollars, which were injected directly into the banks.
However, the banks themselves also contributed to the bailout funds. They paid back billions of dollars to the government in the years following the bailout. Additionally, the government acquired equity shares in the banks, which it later sold for a profit, returning money to taxpayers.
It’s important to note that the bank bailouts did have a wider impact on society. Taxpayer dollars were used to support the banks, while other essential programs and services suffered funding cuts. This was a significant issue for many citizens, who felt that the government was prioritizing the interests of large banks over the needs of ordinary people.
Another point to consider is that the bank bailouts did not necessarily produce the desired results. While they may have prevented a total collapse of the financial system, there is little evidence to suggest that they led to any meaningful structural changes within the banking sector. The same big banks that were bailed out in 2008 remain dominant in the industry today.
In conclusion, it’s clear that taxpayers did contribute to the bank bailouts. However, the banks themselves also made substantial contributions to the funding. Furthermore, the impact of the bailouts on society as a whole is a complex issue that requires further examination. For many Americans, the bank bailouts were a stark reminder of the unique relationship between the government and the banking industry, and the need for greater accountability and transparency in the financial sector.
So, everyone will run to commodities, they need to overinflate commodities to depreciate treasuries, producers will win, but it will go into consumer inflation afterwards, I heard takes 4-6 mth.And then we switch to yuan to trade commodities for goods?
Feeding the YouTube algorithm. Informative video. Thanks.
What interest rate is the fed charging the banks for these loans?
Really good shared this video
Temporary in the the government is always permanent
And they just spent it all on SVB, so now when our bank accounts fail they will be like, ooops all gone…
It's gone, wow South Park got it 100% right, insane
Thanks buddy
What happens when SVB can’t repay bailout and are they (SVB) putting the bailout bank depositors at risk if SVB fails.
The impact of the SVB and SI crises has been clear as day on the regional bank ETF (KRE), which has taken a nosedive by more than 20%. This has triggered a ripple effect, causing a drop in the overall market. But, as history has shown us, a localized and narrow contagion like this presents a ripe opportunity to invest in solid and fiscally responsible companies that have substantial cash reserves on hand.
Inflation is about to creep on the exponential side of the run, it ain't linear it will creep up
Why cant banks just trade in all long term low interest bond and buy short term High interest Tbills since govt is covering it all. Like free money to the banks if goes up they profit if goes bad doesn’t matter govt will bail them out.
It's amazing to see the resilience of Bitcoin, even amidst the chaos caused by the recent shutdown of Silicon Valley Bank. Despite the impact on the financial sector and the crypto market, BTC seems to have emerged unscathed and is once again being hailed as a safe haven asset. This is a testament to the value and potential of this relatively new asset class. There hasn’t been a more better time to start trading, thanks to Linda Wilburn strategy I have been able amass 29 BTC in three weeks of trading. Her expertise and knowledge of the Bitcoin market are unparalleled and I feel incredibly lucky to have found her.
This is not the way to beat inflation idiots
It’s all over…they’re satan
That 1.26% figure that the FDIC can cover, the inverse of that is 79.4 times more than what they can cover…. Normally that would mean there is currently eight levels of this food chain that is collapsing but I think I heard this on your channel that during 2020 that used restrictions temporarily and some of that money was literally backed by nothing not even 10%.
The way I understand that there is only one primary producer in this World economy because of the petrodollar and that is the Federal reserve, every other Central Bank also charges a percentage and loans out their currency that is really backed by dollars….
I think this comes back to the idea that I heard back in 2008 that when the US economy gets the flu the rest of the world gets AIDS. I think we've already been seeing this pop up in certain countries that have extremely high inflation right now….
Joe, special request not related to this video. You've given us recommendations on vendors for gold, bitcoin, fine art funds, etc. Can you do some investigation on a reliable full-reserve bank? They seem to be hard to find on the internet.
Banks are obsolete once CBDC is in position with the central banks in control, so let's start eliminating brick and mortar banks now.
A glorified pawn shop. Got it
I did not know you were still making videos. And I am subscribed with the bell activated.
#Bitcoin
Even years ago the FDIC, FSLIC (now absorbed in the FDIC), and the NCUA only had a combined total of about 2% of the banks', savings and loans' and credit unions' deposits covered. Apparently, this total is even less now that the insured amounts per account have risen over time.
I thought that the mechanisms to control banks runs that were put in place starting in 1933 would be sufficient. I guess not!
One big problem today is that the reserve requirements to cover deposits currently has been reduced to zero.
I also wonder if these new bank runs would not have happened if some people had not sounded the alarm on social media. Did they really have to do it and does anybody gain from it?
The Fed continues to cause more inflation along with (Not) president biden and the Democrats.
Bailout after bailout…
So much information is incorrect on this video, that is not even how banks work.. You say fdic has no money but they just paid over what they posted they had… and the money was printed and does not come from taxes, please do some reseaech
FDIC, FEDERAL RESERVES, TREASURY….managed by incompetent idiots. God help USA.