why we haven't seen many small banks going bankrupt when big banks are suffering. With small asset size, small banks should be more vulnerable to crisis.

His assumptions about the June disaster are mostly unfounded. He would've been right if he had made such prediction during the Depression. But Americans weren't stupid and had learned their lesson. The government had sponsored two institutions Freddie Mac and Fannie Mae that purchase mortgage loans from banks. They serve as a cushion between private lenders and borrowers. Actually, the government has lowered the capital ratio requirement and infused capital into the two companies to bail them out of the mortgage crisis. Because of this, I don't believe small banks would collapse and a big disaster would happen the way he predicted.

So don't get bearish based on this article.