Comment: We can blame bankers

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We can blame bankers

or we can blame people who wanted FDIC insurance. With FDIC, banks cannot go into bankruptcy, otherwise, people will have to repay money to insured depositors. It is cheaper for USA taxpayers to simply allow a weak bank to be taken over by a stronger one before its assets jepordize FDIC liability.

As Austrian economists say - if government tries to do a good thing under pressure of the public, unintended consequences often result in the opposite effect.