BuSab Message Board - Msg: 27843794

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Politics : BuSab

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To: SmoothSail who wrote (11169)	12/24/2011 2:43:04 PM
From: Jorj X Mckie	4 Recommendations Read Replies (1) of 23934

would glass-steagall be necessary if there was no FDIC? I believe that glass-steagall was just another regulation put in place to patch up the unintended consequences of another misguided government "service". That's why we keep on getting more and more regulations. Every service/benefit that the government provides has some unintended consequence that needs to be dealt with. It's a feedback mechanism that causes more and more government regulations. The only laws that I want applied to banks are the ones that force an open book policy that states the deposit/loan ratio. Banks that have a low ratio would have relatively low risk and could probably charge fees or offer lower interest rates. Banks that have high ratio would be more risky and would have to give higher interest rates on deposits to offset the risk. And if a bank takes on too much risk and fails....let it fail. And if someone puts their money in a risky bank to get more return on their money, then they also get to lose their money when the bank fails. If they know the risk going into it, there's no reason that they should be bailed out by a federal deposit insurance.

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