The FDIC and You
Well friends it's time to talk about bank failures and wealth preservation. We have talked about insolvent banks on multiple occasions before but the threat of large banks failing is now imminent. Countrywide was saved from such a fate by Bank of America. Now IndyMac is right on the edge. They're not officially dead yet - only mostly dead but there's no Miracle Max in sight. Their recent letter to stakeholders reads like a death certificate: regulators involved prohibited from getting brokered deposits can't sell stock (no buyers) asset sales would deplete capital (tacit admission of mis-valuation) ===> must stop making loans The FDIC has been bulking up for months now, anticipating a wave of bank failures. So far it's been a few small banks but now it's the big boy's turn. So how secure are bank deposits and and how much can the insurance fund really cover? For now, it looks like the answers are pretty safe (as long as you're under the $100,000 lim...