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FDIC Follow-up (Part II)

Thursday, August 20, 2009, 4:10 PM
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In the prior report on the FDIC, I showed that the FDIC was out of money. The normal mechanism for collecting and paying out of FDIC funds involves collecting premiums from banks and using those to pay out for claims.

In the "Helping Families Save Their Homes Act of 2009" (S. 896) Congress authorized the expansion of an existing $30 billion "line of credit" from the Treasury to $100 billion with a final cap of $500 billion, as long as a two-thirds majority of the Federal Reserve and the FDIC boards think it necessary.

 

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