Bsky, I'm seeing a lot of people on my feed asking good questions like "why would Trump want to gut the FDIC?" and I am happy to answer this question now that I've given it some thought. There are two main reasons as I understand it.
Source is me, a former (non-FDIC) bank examiner. 1/?
Source is me, a former (non-FDIC) bank examiner. 1/?
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Ballpark, order of magnitude...
It's hard to understand how paying out for failures would be less expensive than paying regulators for regular auditing and enforcement.
Official reference for the DIF management bits, including the quarterly fund profile. I read it so you don't have to.
Current DIF balance is $137.1 billion, or 1.3% of all FDIC insured deposits. To put this in perspective, that's 548,000 insured accounts fully funded.
Largest ever DIF loss was Silicon Valley Bank, for about $16 billion. The current fund can sustain a loss roughly eight times that before requiring any funding from somewhere else.
Although I'm sure that the techbro Mafia will be sure to tell us that they can do the same job with some AI bot scraping bank data...or something.
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The CFPB is responsible for consumer regulatory enforcement at the country's largest banks.
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