I was at a Wells Fargo Branch recently in Walnut Creek. I noticed signs all over the bank saying how each account was insured by the FDIC. The FDIC was created in 1933 to provide "deposit insurance which currently guarantees checking and savings deposits in member banks up to $100,000 per depositor."
Adjusted for inflation, the $100,000 you would receive if your bank failed in 1933 would be $1,428,225.34 in today's dollars. So are we being ripped off, or not as well insured as we were back in 1933. $100,000 in 2006 dollars is worth only $7001.70 in 1933 dollars.
Why has the deposit insurance not kept up with the rate of inflation?
FDIC only insured 5000$ in 1933. if your inflation factor of 14 is correct, that's only 70k$ today.
ReplyDeleteYou're right that it hasn't kept pace, but it didn't start at 100k...
ReplyDelete1934: $2500
1935: $5000
1950: $10000
1966: $15000
1969: $20000
1980: $100000
I guess the key word in the sign you saw was "currently".