Tuesday, September 22, 2009

More on FDIC Bonds

Former banker and now Mises Institute president, Doug French, writes to Bob Murphy:

The ultimate in delusional banking. The industry gets pounded lending to: farmers, 3rd world countries, then real estate, then oil & gas, then real estate again, then real estate again, and now bankers will lend money to their "insurer" that is sure to go broke.

and one wonders about the terms..those banks that lend the most get first dibs on failed bank deposits...or could these banks even force a premature shutdown of a bank on the ropes that they have their eye on?

Oh and btw, how does the FDIC regulate a bank that it has borrowed money from to stay in existence?

This will be fascinating.

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