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?
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One bails out the bank, therefore keeping the bank “in business” and ensuring the customers have the money they’ve deposited. The other bails out the bank’s customers but leaves the bank, well, bankrupt. The last several times the government has bailed out the banks they immediately turned around and loaned more money out, using it as a way to make more money instead of propping up their assets. That has a lot to do with why there were any bailouts this time around.
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