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> They may not have anticipated the ferocity with which there would be a run on the bank Bank runs are pretty much always ferocious because 1) that's what a ru
by adhesive_wombat 4y ago
> They may not have anticipated the ferocity with which there would be a run on the bank
Bank runs are pretty much always ferocious because 1) that's what a run is, rather some euphemism for the prelude like "temporary liquidity processing anomaly" and 2) they're positive feedback loops that end up ferocious as soon as someone responding to the "TLPA" gets noticed by someone else.
- eloff 4y agoA more charitable interpretation of what the OP is saying: the execs may not have anticipated how fast the shit would hit the fan. I doubt they believed there would be a run on the bank this month, not even the short sellers were predicting that. They did know they were in trouble, but I think everyone, even those being against SVB, was surprised by the speed and ferocity with which this played out.
- adhesive_wombat 4y agoYou might be validly surprised by the short time between "uh.." and a full-on run, but the run itself is no more ferocious than people responsible for avoiding one should have been thinking of. It's like a airline blaming the ground for being unexpectedly hard and the crash happening so soon and it's not their fault why there were no survivors and not because of the deferred maintenance of the aircraft under a loophole in the FAA regulations.
- paulddraper 4y agoThat's true, though most bank failures aren't bank runs. IDK if there's been a bona fide bank run in the U.S. since the 1930s. The reason this was a bank run is that FDIC insurance meant approximately nothing, as opposed the the usual situation where a huge amount of depositors are fully insured.