The gathering crisis in Federal Deposit Insurance

The gathering crisis in Federal Deposit Insurance

by Kane

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Why Federal Deposit Insurance threatens to break down; Insolvency resolution policies of the deposit insurance agency;...

Discussion questions for The gathering crisis in Federal Deposit Insurance

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  1. 1

    How does Edward J. Kane’s analysis of deposit insurance challenge the common public assumption that our money in the bank is completely risk-free?

  2. 2

    In what ways does Kane illustrate the moral hazard created when government guarantees protect financial institutions from the full consequences of their risky bets?

  3. 3

    When you think about major financial bailouts in your lifetime, how has your personal trust in the banking system been shaped by government intervention?

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