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Let's see the fdic can borrow from ...

Discussion in 'Political Debate & Discussion' started by exscentric, Sep 29, 2009.

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  1. exscentric

    exscentric Well-Known Member
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    The FDIC is running out of money so they have the possiblity of borrowing from the federal government or they can also borrow from the banks that they back. It was mentioned on the news that they were considering borrowing from the banks because there are too many conditions when they borrow from the governement.

    Say they borrow from the banks and then the banks they borrow from fail. Does FDIC have to pay back the loan that they will buy out at pennies on the dollar in the closing of the bank?

    How does all this work? Or should it?:thumbsup:

    http://www.nytimes.com/2009/09/28/opinion/28mon1.html?_r=1&hpw
     
    #1 exscentric, Sep 29, 2009
  2. alatide

    alatide New Member

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    The FDIC has always been funded by the banks. That's the way it was originally set up. Of course, I don't think it has ever gone bankrupt before today.
     
    #2 alatide, Sep 29, 2009
  3. exscentric

    exscentric Well-Known Member
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    Try a dictionary and see if you can find a difference between funding and borrowing :wavey:
     
    #3 exscentric, Sep 29, 2009
  4. Twizzler

    Twizzler Member

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    What a crock. It's like a huge ponzi scheme.
     
    #4 Twizzler, Sep 29, 2009
  5. alatide

    alatide New Member

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    Maybe you should take your own advice. What I said is correct.

    http://www.fdic.gov/regulations/laws/rules/4000-2830.html


    FDIC Insurance Fund Backed by Full Faith and Credit of the United States Government

    FDIC-87-53

    December 17, 1987

    Alan J. Kaplan, Counsel

    Thank you for your letter of December 11, which asks what responsibility the United States Government has should the Federal Deposit Insurance Corporation (FDIC) run out of funds.

    The FDIC, an agency of the United States government, receives no government appropriations; instead, FDIC's funding consists of its income obtained from insurance assessments and from the return on investments made in government securities. At present, FDIC's insurance fund exceeds $18 billion. For 1986, assessment income was $1.5 billion and other income was $1.8 billion. The FDIC also is authorized to borrow up to $3.0 billion from the Treasury, although it has never used this authority.

    Title IX of the Competitive Equality Banking Act of 1987, signed into law by President Reagan on August 10, 1987, serves as a reaffirmation by Congress that the United States pledges its full faith and credit behind the federal deposit insurance funds. Thus, although the FDIC's deposit insurance fund remains strong, Congress has expressed its intention to support the fund, should the need ever arise.

    A copy of Title IX is enclosed.

    --------------------------------------------------------------------------------------------------------------------------------
    The insurance assessments are made to the banks.
     
    #5 alatide, Sep 30, 2009
    Last edited by a moderator: Sep 30, 2009
  6. alatide

    alatide New Member

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    Looks like you just can't admit your ignorance, can you?
     
    #6 alatide, Oct 2, 2009
  7. exscentric

    exscentric Well-Known Member
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    Actually been busy today as usual unlike others that like to sit around raising trouble and just saw your post.

    Read my post I did not say you were wrong. :tongue3: I posted about borrowing and that is still different than funding by paying payments to fund something.:wavey: One is called funding and one is called borrowing. Funding is money fdic does not have to pay back to those that gave it unless they fail. Borrow requires payback.

    While I often admit my ignorance you often show yours.:laugh:
     
    #7 exscentric, Oct 2, 2009
  8. alatide

    alatide New Member

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    The FDIC isn't "borrowing" from anybody. The news was that it is requiring the funding banks to pay now for what they owe through 2012. I guess I have problems with irrational questions.
     
    #8 alatide, Oct 2, 2009
  9. exscentric

    exscentric Well-Known Member
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    Please stop assuming I did not hear what I heard on the news. It was reported twice that they were not going to borrow from the feds, but that they were going to borrow from banks. There was nothing said about prepayments as it seems to be headed now.

    I heard what I heard and posted about it. :thumbs: Argue on as you wish.
     
    #9 exscentric, Oct 2, 2009
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