[chrisk]

Now that the FDIC has guaranteed all uninsured depositors, I wonder if it is time to explicitly gurantee all deposits, regardless of amount.  It will mean that banks will have to pay more to the FDIC in insurance, and probably ought to be subject to more supervision, but if there is fundamentally no difference in how the FDIC treats uninsured and insured accounts, then we should probably say it out loud, shouldn't we?

BC

If the alternative is a 2% chance that the whole thing comes crashing down, an 8% chance of a Depression and a 20% chance of another Great Recession, then I think it's time for financial stomach stapling surgery insuring all deposits. Since we've been merrily printing money for a while anyways.

The level of insurance should clearly be raised, say to $1M, but if you go above that, the beneficiaries are mostly VCs and those in their orbit. Venture-funded companies kept all or most of their money at SVB because either the VCs or SVB required them to. Improved regulation would restrict such policies.

[chrisk]

Now that the FDIC has guaranteed all uninsured depositors, I wonder if it is time to explicitly gurantee all deposits, regardless of amount.  It will mean that banks will have to pay more to the FDIC in insurance, and probably ought to be subject to more supervision, but if there is fundamentally no difference in how the FDIC treats uninsured and insured accounts, then we should probably say it out loud, shouldn't we?

BC

If the alternative is a 2% chance that the whole thing comes crashing down, an 8% chance of a Depression and a 20% chance of another Great Recession, then I think it's time for financial stomach stapling surgery insuring all deposits. Since we've been merrily printing money for a while anyways.

The level of insurance should clearly be raised, say to $1M, but if you go above that, the beneficiaries are mostly VCs and those in their orbit. Venture-funded companies kept all or most of their money at SVB because either the VCs or SVB required them to. Improved regulation would restrict such policies.