Currency insurance and monopoly money failure

The Fed guy in charge of currency insurance talks about the problem:

My understanding from folks who were here at the time is that policymakers were also worried about the moral hazard from deposit insurance. Policymakers at the Board of Governors—including [Chairman] Arthur Burns—were concerned that because the insurance for deposits was so extensive, people who had deposits at a particular bank didn’t really care if the bank was in good shape or not. The worry is that if people who have money at the bank don’t care about the condition of the bank, the bank can take a lot of risks. More bank risk-taking can lead to bank failures, which can be costly for society as a whole.
I should say that while we’re talking about this in the context of the Minneapolis Fed, this was an issue that FDR talked about when deposit insurance was first created. So this was a really well-known issue.

So Fed bankers knew from the start that central monopoly banks must go off the reservation eventually. The cause? Currency insurance in the banking system is just the start.  Indirectly the Fed insures all of the Swamp inflation guarantees.  The Fed insurance, indirectly, that all invented medical procedures applied by doctors to humans in the USA are paid for from the treasury at market price.
The Fed insures all the Swamp guarantees, as we know, because the Treasury has 2.4T on loans and 200 B on deposit, and that imbalance would have erased years ago if the Fed was at maximum entropy.

The net result is that our monopoly money system operates like a supply chain, that is incorrect.  The very definition of money is money appears to be a  spontaneous actor. 

The growing cost of the insurance eventually becomes the ATM fee. But since the sandbox operates with variance bounds and equal observability, it is auto-traded and that ATM fee goes close to zero. The central banks will lose market share as long as they guarantee unsustainable government price fixings.