Peter Schiff: "Deposit Insurance For Banks Is A Bad Idea" - Home ...

I agree with Peter 100%, and I have been preaching this for years. With the FDIC in place, there is no incentive for people to research and find good, strong banks. People shop for the highest interest rates without any regard to the banks' soundness. This gives the bank no incentive to be smart about their investment policies. In fact, it's often the banks that are doing the dumbest things and have the low ratings that are offering the highest interest rates. And those banks attract the most customers and become the largest banks. You have only to look around at what's happening in the banking industry for ample evidence.

If there were no government safety net, that vacuum would be filled by the private sector just as it was in the insurance industry. You can argue all day that the government should be involved, but if you look at what's happening around us, you can see it's a bad idea. The more the government got involved in the mortgage industry and Wall Street, the worse things got. And look where we are now.

Look at the track record of the insurance industry vs the banking industry, and it becomes very clear that the private sector does a much better job of making money, and of protecting consumers.

The trouble with socialism is that it's persuasive in it's arguments, and moves in slowly. People readily accept it, little by little -- like the FDIC -- because it feels good and safe. Before you know it, we have a government-owned auto company, government-owned banks, and, perhaps, a government-owned health care industry.

It will never stop until people wake up and realize we're much better off without that particular safety blanket.

Source: http://dailybail.com/home/peter-schiff-deposit-insurance-for-banks-is-a-bad-idea.html

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