Last time I read anything current on the FDIC, there was something on the order of $8 billion to cover deposits of gargantuan amounts in comparison. IOW, they’d be broke in minutes. The FDIC is a sham.
Basically what will happen is the feds will have to crank up the printing presses to such a degree that when you get your money, it will be worthless anyway.
What happens when a bank goes belly up is that the FDIC covers the amounts under the max. Then they sell the assets to another bank—its more like its assigned—and they take over the good stuff and the bad loans and what not are liquidated.
So, the total amount the FDIC is on the hook for would not be the complete capitalization of the bank.
Thats the plan.
What is not in “the plan” is multiple LARGE failures at one time. You are correct. If more than one large bank goes under at once, we are screwed.