FDIC considers borrowing cash from banks
Insurance fund that protects depositors is quickly running out of money
http://www.msnbc.msn.com/id/32963393/ns/bu…new_york_times/
The GOVERNMENT OWNED COMPANY that is supposed to protect us economically in case our banks fail is going to borrow from the banks that are currently failing left and right to ensure that they can continue to insure us.
Is this an Atlas Shrugged Kodak Moment, or WHAT?
What a sham. Just take the FDIC out back and shoot it already. Put it out of our misery. Useless crock.
Let me get this straight. For months and months, the government has been pushing banks to resume lending to overleveraged businesses and individuals. Now, our government, which is itself extremely overleveraged, is going to compete with those private businesses and individuals for the funds that the government was pushing the banks to lend. Yep, that makes sense. 
Basically, the FDIC takes money from all banks, and uses it to shore up bad banks. With so many bank failures, the FDIC recently raised the amount that banks-left-standing had to pay; but, the FDIC might need more funds if banks continue to fail at the current rate. Under law, they have the option of taking more money from banks-left-standing. Instead, they have hit upon this route of taking the money, but promising to pay it back. That way, if things go bad, they can convert these loans into permanent charges. If things go better than expected, they will repay the money. By calling it a loan now, the banks can continue to show the money as an asset, and not take a charge to their P&L — unless what the FDIC fears comes true, and the funds have to be tapped to save more failing banks.
Sooo…I wonder if the banks they now own majority stakes in will agree to lend them money?..I’m just sayin’
I’d like to know how anyone is still fooling himself that the FDIC is part of the solution.