U.S. Banking System Faces Worsening Crisis in Confidence

The national news cycle has careened from one extraordinary and alarming story to the next. The brewing crisis in banks remains front and center. Americans are watching a demonstration on how to take a crisis in confidence and make it worse.

Many Americans have already lost trust in the FBI and DOJ. They don't trust Janet Yellen and other bureaucrats in Washington, and they don't trust Wall Street bankers.

The ongoing erosion of trust may be the most fundamental of all problems the country faces.

It is playing larger and larger roles in everything from elections, to the administration of justice, to finance.

The current troubles in banking may be a signal that confidence has slid past the point where it can be recovered.

Officials called an emergency meeting following the collapse of Silicon Valley Bank and extended the FDIC guarantee to cover bank deposits larger than $250,000.

Americans were supposed to think all deposits were safe, but they were not comforted. Bank stock declines continued, as did the deposit flight from small banks to big banks.

Meanwhile, Janet Yellen admitted in testimony before congress last week the program was really more of a selective guarantee. A committee will first have to determine whether a bank's failure represents a risk of contagion before deposits are 100% guaranteed.