"Pilate saith unto him, What is truth? And when he had said this, he went out again..."

Location: Tampa, FL, United States

Friday, February 27, 2009

FDIC being Katrina'ed

Apparently the Federal Deposit Insurance Corporation (FDIC) is being pummeled by waves of bank failures (story here ). The article states, "Depositors are not at risk because the fund is backed by the government." I would suggest depositors are at risk because according to Thomas E. Woods, Jr., author of Meltdown, the FDIC only has enough assets to meet 0.5% of its potential obligation(s). So, if the FDIC runs out of funds because of its inordinate guarantee either the national debt gets run up or some government entity flowing with green (oxymoron) gets siphoned to shore up the FDIC. In either case depositors are at risk. If nothing else the subsequent inflation from an FDIC "bailout" would lessen the purchasing power of depositors' existing dollars. I suspect the Washington Post injected the spin to stay in the good graces of the national leviathan.

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