Imagine the United States without federal deposit insurance. What are some of the mechanisms that would arise to “punish” bank managers who acted irresponsibly?

In this chapter, you read about the bank-customer relationship as well as a bank’s duty to honor checks and accept deposits. In the macroeconomics courses that your business school offers, the focus on the banking sector is quite different. At a minimum, the courses examine banking panics and what they did to the economy. During the recession that started in December 2007, the federal government wanted to make sure that no banking panics would occur.