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https://www.wsj.com/articles/risk-svb-fdic-government-financial-markets-stability-d9c65be7

The FDIC Has Transferred the Cost of Bank Failures

When it swallows the cost of failure to stabilize markets, risk-taking increases.

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The Federal Deposit Insurance Corporation headquarters in Washington, March 14. Photo: Manuel Balce Ceneta/Associated Press

Dan Katz and Stephen Miran are right to note that recent government actions have heightened risk (“The FDIC Guarantees Instability,” op-ed, May 11), but they fail to note the fundamental problem: Transferring the cost of failure from the risk-takers to others increases overall market risk.

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Copyright ©2023 Dow Jones & Company, Inc. All Rights Reserved.

Copyright ©2023 Dow Jones & Company, Inc. All Rights Reserved

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com.