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I just got an email from Mercury saying they’re well capitalized and all is well. “ I want to assure you that Mercury is in a strong financial position (profit

I just got an email from Mercury saying they’re well capitalized and all is well. “ I want to assure you that Mercury is in a strong financial position (profitable and well-capitalized), and we have a number of ways that we keep deposits on Mercury safe:” Uhoh.

Spivak 4y ago
Is there any bank out there that can survive a panic bank run?
- qzw 4y ago
  Yes, if you count central banks and don’t mind hyperinflation. But that’s probably not what you’re asking. I don’t think any ordinary commercial or retail bank could survive a run without outside help.
- guestbest 4y ago
  Sure, as long as the bank makes a cryptocurrency to back up deposits
- metalspot 4y ago
  JP Morgan Chase, Bank of America, Citibank, and anyone else who will be bailed out by the fed. But seriously, the problem with SVB was that their assets are trash and everyone knew it. If their assets were actually worth what they claimed they would have no problems.
  - funstuff007 4y ago
    I don't know about that. I think it's more that they never hedged their interest rate risk (or they invested in assets that were too long duration).
  - skeeter2020 4y ago
    This is not the same situation as dogshit assets from the sub-prime crisis; the bonds are not "trash" in the sense people are thinking, but long-term, lower interest instruments. As interest rates have risen they are a relatively poorer invesment, but still have the long-term (illiquid) value of the underlying asset less the curret rate to return differential. It's inaccurate to say they mis-stated the value of their assets.
    - deleted 4y ago
      [deleted]
phkahler 4y ago
Yeah, that sounds bad.
babyshake 4y ago
"As long as everyone doesn't try withdrawing their money all at once, everything will be fine. So don't panic..."
- jrockway 4y ago
  Isn't this true of every bank since fractional reserve became legal?
  - skeeter2020 4y ago
    Fractional reserves have never been illegal; the practice predates government monetary policy. The alternative would be a vault or safety deposit box.
deleted 4y ago
[deleted]

Spivak 4y ago

Is there any bank out there that can survive a panic bank run?

qzw 4y ago
Yes, if you count central banks and don’t mind hyperinflation. But that’s probably not what you’re asking. I don’t think any ordinary commercial or retail bank could survive a run without outside help.
guestbest 4y ago
Sure, as long as the bank makes a cryptocurrency to back up deposits
metalspot 4y ago
JP Morgan Chase, Bank of America, Citibank, and anyone else who will be bailed out by the fed. But seriously, the problem with SVB was that their assets are trash and everyone knew it. If their assets were actually worth what they claimed they would have no problems.
- funstuff007 4y ago
  I don't know about that. I think it's more that they never hedged their interest rate risk (or they invested in assets that were too long duration).
- skeeter2020 4y ago
  This is not the same situation as dogshit assets from the sub-prime crisis; the bonds are not "trash" in the sense people are thinking, but long-term, lower interest instruments. As interest rates have risen they are a relatively poorer invesment, but still have the long-term (illiquid) value of the underlying asset less the curret rate to return differential. It's inaccurate to say they mis-stated the value of their assets.
  - deleted 4y ago
    [deleted]

phkahler 4y ago

Yeah, that sounds bad.

babyshake 4y ago

"As long as everyone doesn't try withdrawing their money all at once, everything will be fine. So don't panic..."

jrockway 4y ago
Isn't this true of every bank since fractional reserve became legal?
- skeeter2020 4y ago
  Fractional reserves have never been illegal; the practice predates government monetary policy. The alternative would be a vault or safety deposit box.

deleted 4y ago

[deleted]