FDIC Discloses Deposit Insurance Fund Is Now Negative
In an unprecedented disclosure, the FDIC has highlighted that it expects the DIF reserve ratio to be negative as of September 30. As there are a whopping 48 hours before that deadline, one can safely assume that the DIF is now well into negative territory: as of today depositors have no insurance courtesy of a banking system that has leeched out all the capital of the FederalDeposit Insurance Corporation. Let’s pray there is no run on the bank soon.
(FDIC’s full memorandum outlining its failure can be found here.)