One of the causes of the S&L crisis some years back was the government’s increase of the limit on federal deposit insurance from $40,000 per account to $100,000. Bankers looked at this and thought, well now, I can make big, big bucks by taking on far more risk with my loans (which pay higher interest), and if the loans go into default, why, I’m covered for more than twice the amount of government insurance. They did indeed take on much more risk; thousnds of their big real estate development loans defaulted; and it ended up costing taxpayers half a trillion … Continue reading Don’t Forget This Stupid Stunt