How can an FDIC guarantee be called a government bailout?
The FDIC guarantee is not what people are calling the bailout. So far, from what I know, the FDIC has not has to pay out very little money for deposit insurance payments. The bailout was the federal government injecting hundreds of billions of dollars into banks because they made bad investments. Banks gave out mortgages to people who never should have had them. These people had absolutely no ability to pay them back. They then sold these mortgages to other banks. So when these mortgages failed, the banks were on the verge of collapsing. That was the bailout. We weren’t giving money to people when they lost their money, we gave money (hundreds and hundreds of billions of dollars) to banks because they screwed up and nearly toppled our entire economy. There was no option to bail them out.
