Monetary policy, ever difficult to conduct, became even more difficult over the last week as one of the most difficult processes in banking came to fruition for one bank and brought down another bank in the process: a bank run on deposits. The lessons the US government and the banking industry learned during the Great Depression helped create the Federal Deposit Insurance Corporation (1933), which instituted insurance on banking sector deposits. Insurance on deposits went from $2,500 back in 1933 to $250,000 today. It seems that one of the biggest issues for SVB was that a large percentage of depositors were not ... (full story)