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It’s only logical to cover FDIC right after banking because in case a bank fails, FDIC comes forward and takes over the bank.First of all I have made various posts about FDIC since last year and none of them have incicated anything good for FDIC they have all shown consistently that FDIC has more problems ahead..it’s almost a trend…news articles listed in those posts have clearly shown that there is constant on coming shortage of money with FDIC and it is constantly trying to raise/maintain funding.

Here are references to those posts I made earlier since last year..feel free to explore…all these combined together are probably the largest news repository on the net available anywhere.

http://www.diwakars.com/wordpress/2008/07/fdic/
http://www.diwakars.com/wordpress/2008/07/friday-april-4-2008/
http://www.diwakars.com/wordpress/2008/08/fdic-iii/
http://www.diwakars.com/wordpress/2008/08/fdic-iv/
http://www.diwakars.com/wordpress/2008/09/fdic-v/
If I made this post only about FDIC it would be my 6th post on FDIC. But we are in America and no one cares about counting or accouting so let’s not count but should simply move ahaed….let us just do that.

Now FDIC did not find a need to advertise themselves as much in the past as they do now. Why ? I am not sure..is it so..that people are scared of their banks and taking their money out and putting them in shoe boxes ? You may be surprised but that’s what is actually happening…and FDIC’s own ad proves it.

Check this out..play this video…

And then….here is the latest report from Karl Denninger from Market Ticker as of Jun 1, 2009.

First of all he called this video clip you just played a propaganda…but why am I explaining that…just read what he said.

..this is extract from his article…

Now for some facts, after you watched the government propaganda ( that video you played..). All of these facts (listed below) , unlike that propaganda, are in fact mathematical realities.

From Bloomberg:

The agency’s deposit insurance fund, supported by fees paid by banks, fell to $13 billion in the first quarter from $17.3 billion in the preceding three -month period. The FDIC has imposed an emergency fee to raise $5.6 billion to rebuild the fund, with more assessments possible this year. The agency forecasts failures will cost $70 billion through 2013.

How much is the $13 billion in FDIC insurance?

The FDIC insures 4.8 trillion dollars in deposits in US banks and thrifts, and yet they have 0.27% - more than two-thirds less than they had a bit more than a year ago - in money to “cover” those deposits.

It is true that the FDIC also has the ability to borrow (up to $100 billion now, and they are trying to secure the ability to borrow up to $500 billion) from Treasury should they run short of money.

It is true that nobody has (yet) ever lost one penny of insured funds at an American bank.

And finally, it is almost certainly true that should Congress have to print up literally any amount of money, irrespective of whether that printing of raw money drives oil to $300 a barrel, gasoline to $10 a gallon, and bread to $20 a loaf, in order to prevent the FDIC from being able to pay you with (perhaps worthless) dollars, they will - because they understand full well that the alternative could quite easily be that you reach for a pitchfork - or worse.

But if you believe that having 0.27% of the insured base of deposits as a reserve, having lost more than two thirds of the original reserve due to malfeasance and misfeasance, when not one person has been indicted, prosecuted or imprisoned for their misconduct over the previous two years constitutes “well-capitalized, prudently operated and able to meet insurance obligations”…

… you are free to believe that. Click here to read full article

Then there are increasingly more number of banks who are not able to see green shoots…again a very recent article from CNN.

Problem bank list tops 300
FDIC reports that the number of troubled lenders rose by more than 50 during the first quarter and hit its highest level since 1994.
By David Ellis, CNNMoney.com staff writer
Last Updated: May 27, 2009: 11:57 AM ET

The Federal Deposit Insurance Corp. said that the number of lenders on its so-called “problem bank” list jumped to 305 during the first three months of 2009, from 252 in the fourth quarter of last year. This is the highest level of troubled institutions since 1994.

“Banks are making good efforts to deal with the challenges they’re facing, but today’s report says that we’re not out of the woods yet,” FDIC Chairman Sheila Bair said in a statement.

We all know about those efforts…creative accounting you already read about then in banking.

And then these 2 banks which were recently shutdown..they couldn’t see ‘green shoots’ and couldn’t hold on till the green shoots became a tree….

Regulators Shut 2 Failed Banks In Illinois
Facebook Huffpost - Regulators Shut 2 Failed Banks In Illinois stumble.
IEVA M. AUGSTUMS | May 22, 2009 08:36 PM EST
CHARLOTTE, N.C. — Regulators on Friday shut down two more banks, boosting the number of federally insured bank failures this year to 36.

How the hell did that happen…how come they could not take advantage of those greenshoots.

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