>It's not that the assets are illiquid -- it's that they insufficient. You are confusing price today with the actual characteristics of the instrument. A T-bi

>It's not that the assets are illiquid -- it's that they insufficient. You are confusing price today with the actual characteristics of the instrument. A T-bill pays back it's face value always, it just trades below face when interest rates are higher than when it was purchased. That is the definition of a liquidity problem. You'll get the face value back eventually (it is sufficient), but not if you sell today. A liquid market is not the only characteristic of liquidity. There's a liquid market for anything at a low enough price... >If depositors held their money at SVB for 20 years and SVB didn't have a bank run right now, SVB would still be in trouble: SVB would be paying more interest on those deposits than they would receive on their investments, and their portfolio would slowly go negative. This is a true statement people are making that has nothing to do with what happened here. The point of a bank is interest rate arbitrage, so I agree SVB would have to do their job better over those 20 years, but this thing that happened over 3 months is a liquidity crisis. They weren't running out of money to pay interest on deposits, they were running out of money to give those deposits back and were veering into the problem discussed above - selling things below value to create liquidity.