What is the practical difference between a government bailout vs. the FDIC being made to keep all depositors whole, even over the normal insured $250k limit?

Question

What is the practical difference between a government bailout vs. the FDIC being made to keep all depositors whole, even over the normal insured $250k limit?

In: 21

Answer 1

When the FDIC comes in, the bank depositers (who put their money in the bank in good faith) are saved. The bank owners (whose carelessness caused the problem) are left to die. In a bailout, the opposite can happen.