FDIC move to insure $250k passes the senate

The Senate just passed (as part of the bailout bill) a provision to raise FDIC protections from $100,000 to $250,000 per account. This merely restores the inflation-adjusted protections from 1980, as I noted in July.

Wired makes the accusation that this "insures deposits for the wealthiest" but there's more to consider. According to HousingPanic, fully 1/3 of bank deposits were uninsured by the old limits.

This change avoids a run on banks for a considerable portion of the $2T that was previously uninsured, hopefully at a small cost. The "bailout for the wealthy" story needs to take into account at least some of the systemic risks, but that's been the story all week.

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