Market discipline

Well, let me start by making a distinction between depositors and non-depositors.

I think there's a lot of unfounded expectation that depositors should be the source of market discipline.

I think that's wrong.

I think that there should not be a system that's designed to put the burden on depositors to exercise market discipline.

So the trade-off between moral hazard and deposit insurance is richly covered in the literature, but I don't think it's reasonable to expect depositors to closely follow the health of one bank versus another.

Don, is that true in all cases? Because, I mean, obviously that's the whole reason deposit insurance exists, you know, up to $250,000 per account.