11/07/2008 05:12 am ET Updated May 25, 2011

United States, Please Emulate Ireland and Germany and Insure all Depositors

United States, please tell every bank depositor that all their savings in US banks, regardless of the amount, are insured by the FDIC. Not doing this is creating silent runs on banks. Especially from big customers who can go outside the U.S. Moreover, it is making people move away from banks as depositors to banks as custodians and shifting from deposits to bonds.

That's what I did with all my liquid funds and it only hurts the system. If the U.S. guarantees depositors, then people will stop running from bank to bank or leave their funds as deposits and banks will not go bust. More important, they will go on lending and then they will focus on rebuilding the asset side of their balance sheet (which is for all of us, our liabilities).