The FDIC Well Runs Dry

The well is dry. FDIC officially doesn’t have enough cash on hand to cover projected loan-losses from insolvent banks in its stewardship.

No, this doesn’t mean FDIC closes shop. It means that FDIC 1) prays that it doesn’t need the cash; and 2) makes sure the Fed and US Treasury are on speed dial so it can ask for funds.

Where do these funds come from? You and I, of course. Not through taxation (because current taxes don’t cover current expenditures), but through good ‘ol money printing.

Not that I think the FDIC should allow depositor funds to disappear. It’s just too bad we already blew our wad on bailing out the I-banks.

FDIC’s full report