There is one thing the government can do that would do a lot to restore confidence; raise the antiquated $100,000 limit on FDIC deposit insurance. It is not controversial. Congress won’t meltdown while talking about it. And it won’t cost the taxpayers a dime.
I have been arguing for weeks that we should increase the limit to $1 million so people won’t have to run around town dividing their IRA, 401k and life savings accounts among banks. That is especially important now that the number of banks has been reduced by the recent casualties.
Today the Irish government did me one better. Read the story here: Ireland guarantees all bank deposits.
We must restore faith in the soundness of our banks. We must do it now.