FDIC Seeks Insurance Increase - Black Enterprise
Black Enterprise Magazine September/October 2018 Issue

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fdic_edited-1The Federal Deposit Corporation approached Congress this afternoon about increasing the federal deposit insurance limit in hopes that the move will reassure nervous savers and help small businesses.

Rep. Barney Frank of Massachusetts, said in a memo to members of the House Financial Services Committee that “Sheila Blair, chairman of the FDIC, notified me that they will be requesting authority to increase deposit insurance limits. We will provide additional details as we have them,” according to Bloomberg.
Increasing the FDIC limit from $100,000 may be a short-term patch to mend the damage done to the markets yesterday after lawmakers rejected a plan by Treasury Secretary Henry Paulsen to infuse the financial markets with $700 billion.

As markets closed today, the Dow rose 485.21, or 4.68%, to 10,850.66 after falling almost 778 points on Monday, the worse one day point decline since Sept. 11, 2001. The massive rebound is attributed to the idea that increasing the limit could help ease a crisis of confidence in the banking system and help small businesses.

Presidential candidates Sens. Barack Obama and John McCain both called the White House this early this morning to discuss how increasing the FDIC to $250,000 would help reassure consumers who — after witnessing the collapse of Bear Stearns, Lehman Brothers, and several other top tier financial institutions — fear losing money in the system.

“The current insurance limit of $100,000 was set 28 years ago and has not been adjusted for inflation,” said Obama in a statement, pointing out that the current FDIC insurance is insufficient for businesses that need to meet payroll, buy supplies, and invest in expanding and creating jobs. “I am proposing that we also raise the FDIC limit to $250,000 as part of the economic rescue package.”

Additionally, McCain advocates that Congress include in the bill a proposal to use $250 billion from the Treasury Department’s exchange stability fund  to help stabilize the financial system by buying up failed mortgages.

“A lot of small businesses are struggling to cover their monthly expenses and still have something left to put into savings,” said Stuart Robertson, general manager of ShareBuilder 401k, in a statement. “Before this down economy set-in, the number of small businesses making regular contributions to their savings plan was actually on the rise. Today we’re beginning to see a step backwards.”

Nevertheless, many in Congress don’t see the bailout as helpful to small business owners and individuals, and many of their constituents have called upon them to vote against the bill despite the aforementioned warnings. They see the $700 billion bailout as a hand out to wealthy Wall Street executives who caused the problem, while leaving main street taxpayers in the lurch.

The Center for Responsible Lending says that the crisis on Wall Street will grow worse until foreclosures are stopped. About “6.5 million homes will be lost to foreclosure over the next few years.  These losses will be a huge economic blow,” said Martin Eakes, founder and head of Self Help and

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Marcia Wade Talbert

Marcia is a multimedia content producer focusing on technology at Black Enterprise Magazine. In this capacity she writes and assigns stories to educate readers about social media; digital integration; gadgets, apps, and software for business and professional development; minority tech startups; and careers in STEM (Science, Technology, Engineering, and Mathematics). In 2012, she received two Salute to Excellence Awards from the National Association of Black Journalists and was recognized by Blacks in Technology (BiT) as one of the Top 10 Black achievers in the tech arena for 2011 at SXSW in Austin, Texas. She has spoken about technology on panels for New York Social Media Week, at The 2012 Rainbow/PUSH Wall Street Summit, as well as at Black Enterprise’s Entrepreneurs Conference and Women of Power Summit. In 2011, SocialWayne.com chose her as one of 28 People of Color Impacting the Social Web, and through crowdsourcing she was listed as one of BlackWeb2.0's/HP's 50 Most Notable African American Tastemakers in Social Media and Technology for 2010. Since taking on the role of Tech editor in September 2010, she has conceived and produced five cover stories on Technology and/or STEM and countless articles, videos, and slideshows online. Before joining BlackEnterprise.com as an interactive general assignment reporter in 2008, she freelanced with Black Enterprise beginning in 2003 while working as the technical editor at Prepared Foods magazine. There she further honed her writing skills and became an authority on food ingredients, including ingredients used in food fortification and enrichment. Meanwhile, her freelancing with Black Enterprise and BlackEnterprise.com helped her stay current on issues pertaining to the financial and business welfare of African Americans. As a general reporter for Black Enterprise she attended and reported on the Democratic and Republican National Conventions, where she interviewed Valerie Jarrett, senior advisor and assistant to President Barack Obama and U.S. Attorney General Eric Holder. Marcia has a Bachelor of Science degree in Agriculture with an emphasis in food science from the University of Minnesota, and a Master of Science degree in journalism from Roosevelt University in Chicago. En route to her secondary degree, she served as the editor-in-chief of the Roosevelt University Torch, a weekly, student-run newspaper. An avid photographer and videographer, Marcia is one of several employees at BLACK ENTERPRISE who interned for the publishing company as a college student. She lives in New Jersey with her husband, a food scientist; her seventeen-month-old daughter; and “The Cat”, but still considers Chicago home.

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