Loan To the extent that the government actually increases cost of...

March 18, 2023 at 9:55 AM  ·  Comment — Archer T. Ships replied to his own comment.  ·  View on Facebook  ·  Markdown source

Loan To the extent that the government actually increases cost of insurance and/or sticks to the FDIC limits, then banks will be incentivized to be more cautious. However, as illustrated with SVB and other politically connected "too big to fail" banks, the government has not allowed market discipline to operate, and instead shifted the costs of the bank's bad decisions to the taxpayers.