In the past few days, we have witnessed the collapse of two major banks in the United States. The Fed took over both Silicon Valley Bank of California and Signature Bank of New York. A number of prominent politicians have suggested that depositors will be taken care of, but investors and stock holders in the banks may not be so fortunate.

Treasury Secretary Janet Yellen reported that all depositors will be made whole. No losses will be borne by the taxpayer. It was also reported that some depositors exceed the amounts guaranteed by the FDIC. Will the FDIC cover loses greater than the insured amount or will the taxpayer eventually be on the hook? What if this trend continues through the banking world in upcoming weeks?