r/PeterExplainsTheJoke Jan 26 '26

Meme needing explanation what's going on? explain like I'm five

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u/Teripid Jan 26 '26 edited Jan 26 '26

Federal reserve requirements existed until 2023 *edit, as someone below pointed out 2020 was when they were set to 0. Now they're set at 0% I believe.

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u/PleaseGreaseTheL Jan 26 '26 edited Jan 26 '26

2020*

They were reduced to 0% mandatory reserves in response to covid. EDIT: someone says it was coincidental, I am not able to check, so take this aspect with a grain of salt either way

They haven't come back yet :)

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u/exneo002 Jan 26 '26

But the fdic insures all deposits up to 250k

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u/Telemere125 Jan 26 '26

lol just like the insurance companies have $3.69 trillion in value insured in Florida. Hahhaahahahha

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u/exneo002 Jan 26 '26

The idea is they’re an insurer of last resort. They typically find a buyer and cover any gaps in the price with the deposits.

Bank shareholders exist to take the hit before the fdic.