Tuesday, January 6, 2009

99.65% of Commercial Banks Survived 2008

Yesterday this piece was in MJ Perry's blog, Carpe Diem. He is an economist who uses facts to counter balance media hysteria. A link is in the column at the left.

According to FDIC data, 25 commercial banks failed in 2008, out of 7,146 banks in the U.S. The failed banks represent about 1/3 of 1% of all banks, meaning that 99.65% of banks survived the 2008 recession. The chart above displays annual bank failures back to 1970 (data here), showing the S&L crisis (shaded) when almost 3,000 U.S. banks failed.

Before we make comparisons to the Great Depression, we might want to first compare today's financial troubles to the S&L crisis of the 1980s and 1990s, when almost 3,000 banks failed.


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Paul Banbury
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