Should the US raise the $250,000 ceiling on deposit insurance?
Written by Black Hot Fire Network on May 2, 2023
When Silicon Valley Bank and Signature Bank failed in March, the Treasury, Federal Reserve, and Federal Deposit Insurance Corporation (FDIC), invoking a provision of law that applies when they determine the financial system is at risk, covered billions of dollars in deposits that were above the $250,000 legal ceiling on deposit insurance. That led to speculation that the government was, at least implicitly, lifting the deposit insurance ceiling. When First Republic failed in May, the FDIC reached an agreement with JPMorgan Chase that protected uninsured depositors. All this has sparked questions about the wisdom of the $250,000 . . .
