Silicon Valley Bank and Signature Bank are the two midsize banks that just collapsed. But... how can we have major bank failures, with billions of dollars at stake. Didn't we learn how to regulate banks during the financial crisis of the Great Recession? That was barely 15 years ago!

In this episode, my guest, Dr. Lawrence White, explains that almost always when a bank run occurs, it's on a bank that's already insolvent! And he explains that we've been here before. That is, we've experienced how increases in interest rates have caused bank crises in the past. Dr. White has much to say about the impact of the FDIC on our banking system. He tells me about a time before FDIC when banks functioned just fine... that the relied on capital reserves to attract depositors - not an FDIC sign on their window!

But Dr. White doesn't just leave here. In the perspective segment of our conversation, he provides an alternative banking system - one without an FDIC and with minimal regulations.

To learn more about Dr. White and his extensive research and publications, you can visit his academic homepage.

In addition, below is a link to another podcast conversation with Dr. White:

S2E11: History of US Inflation.

Also, this is the link to The Daily, a New York Times podcast episode about Barney Frank.

Adel

Host of the ⁠History Behind News⁠ podcast

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