Bank Failures Still Haunt Americans

By Richard Gibson
Feb 2 2011

According to a new government survey released this morning, most Americans do not trust the banking system in the US-based on the failure of hundreds of banks 2 years ago.

This is a leftover feeling from the devastation of the financial crisis and one that the government would like to change. The feeling of distrust in financial systems dates all the way back to the times of the Great Depression.

During the Great Depression most people feared banks after they had failed during the financial fallout. As such many started hiding their money around the house and throughout their property believing that banks would eventually rob them of the cash that they had.

In this day and age things appear to be the same way. Americans simply have little faith in the banking system, especially after the bailout that was handed to many of the largest and believed to be stable banks.

But the federal government is planning to change all of that. President Obama has developed the plan to increase faith in the system. He has commissioned a group to develop a set of regulations that will take away the fear that most of the consumers have and replace it with trust and faith.

However, the government likely has a long way to go as the newest information shows that the FDIC rescued more than a dozen banks in the last several months after they were at risk of failure for bad choices being made in loan operations.