If they don't realize the money back from asset sales, that would be inflationary. Getting their money back strikes me as somewhat unlikely, since if the assets were really worth that much, the bank wouldn't be in trouble. Prior FDIC failures haven't been bailouts, they've just been insurance payouts, but tapping into the public pocketbook is bailout territory.
Note that this the other half of what the Fed is trying to do -- they're trying to hold banks together by lending them hundreds of billions at bargain-basement rates, and the FDIC mops up the ones that still can't survive.
These bailouts paid for by: you.
edit: reworded the first couple of sentences. They were pretty bad.
I don't see it as particularly concerning. The FDIC's funded by charging banks. If they have cash flow issues and need to borrow in the short term, then they'll either be able to make their debt service with the current premium levels, or they won't. If they can't, they'll raise premiums.
If they don't realize the money back from asset sales, that would be inflationary. Getting their money back strikes me as somewhat unlikely, since if the assets were really worth that much, the bank wouldn't be in trouble. Prior FDIC failures haven't been bailouts, they've just been insurance payouts, but tapping into the public pocketbook is bailout territory.
Note that this the other half of what the Fed is trying to do -- they're trying to hold banks together by lending them hundreds of billions at bargain-basement rates, and the FDIC mops up the ones that still can't survive.
These bailouts paid for by: you.
edit: reworded the first couple of sentences. They were pretty bad.
Hell, I'll pay for it. Why do I have any reason to believe the buck will ever stop with me?
Er...isn't that what I'm supposed to think, anyhow?
ArrMatey - BM Hunter
I don't see it as particularly concerning. The FDIC's funded by charging banks. If they have cash flow issues and need to borrow in the short term, then they'll either be able to make their debt service with the current premium levels, or they won't. If they can't, they'll raise premiums.
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