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Who are the kids in this analogy? It seems like what's at issue is whether or not depositors are protected (executives, shareholders, and creditors are all gett
by apendleton 4y ago
Who are the kids in this analogy? It seems like what's at issue is whether or not depositors are protected (executives, shareholders, and creditors are all getting the shaft). Do you think depositors should have made different choices, and if so, which?
- lmm 4y agoDepositors shouldn't have piled all their assets into one bank because it was paying slightly more interest. Not saying every depositor did that here, but many did.
- astrange 4y agoNobody used SVB because it paid more interest. (It didn't pay interest at all in fact.) They did it because the name was cool or because other banks wouldn't give you an account for your startup at all. It's normal to go for a regional bank when regular ones don't understand your business.
- siavosh 4y agoI wouldn't take the analogy too literally. But the 'kids' are all market participants in the system the government is trying to regulate. My point being is there is a reason certain entities don't communicate with full transparency and sometimes they find ambiguity a tool. Now whether this is the right or wrong thing to do in this case in the short and long terms...I'll have to leave that judgement to the history books.