Quote:
Originally Posted by Two Bills
Why should the Government, ie. the tax paying man in the street, have to keep picking up the tab for private companies that keep making the same mistakes?
Governments keep bailing them out, crisis after crisis, yet the same fat cats keep their jobs, keep their huge bonuses, but never accept the responsibility of their actions.
|
The Dodd Frank act takes government off the hook as the first line of defence for bank "bail outs". It established a "bail in" rule. This rule in essence allows the bank to seize non FDIC insured accounts in their bank to stay liquid.
"Are Bank Bail-Ins Legal In the United States?
Bank bail-ins are legal in the United States under the Dodd-Frank Wall Street Reform and Consumer Act
The federal government will no longer inject taxpayer dollars to prevent big bank failure. Instead, banks now have the authority to use debt capital as equity to avoid failure. This includes capital from unsecured creditors, common and preferred shareholders, bondholders, and depositors whose account balances exceed the FDIC-insured limit of $250,000."
This is called a debt/equity swap.
So how to keep your bank account safe ?
1 Keep you money in an FDIC insured account
2 Keep those accounts under the max insured limits
3 Use one of the 8 G-SIB banks
4 Put the money under the mattress and pray the house does not burn down