Part 7/11:
Government and Regulatory Responses
In response to these brewing issues, Congress has proposed raising FDIC insurance limits from the usual $250,000 to as high as $10 million. While this might soothe some depositors temporarily, many experts see it as an overreaction that doesn’t address the root problems.
Moody’s and other analysts maintain that the banking system remains relatively sound, with default rates on high-yield debts still low compared to 2008. Default rates are under 5% this year and are projected to stay below 3% in 2026, which is significantly lower than the double-digit figures experienced during the last crisis.