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I've got no love, nor much respect for venture capitalists, but I don't see that wanting, or expecting, to get your money out of a bank account to be corrupt or

I've got no love, nor much respect for venture capitalists, but I don't see that wanting, or expecting, to get your money out of a bank account to be corrupt or hypocritical. Equity bailouts, TARP relief funds, debt guarantees... those are entirely different stories. I also don't blame them for whining and complaining, likely anyone would do the same. The Fed sometimes has to make tough decisions, complying with everything that VCs want just reduces any faith or respect markets have for the Fed and its officers.

LiquidSky 4y ago
>I've got no love, nor much respect for venture capitalists, but I don't see that wanting, or expecting, to get your money out of a bank account to be corrupt or hypocritical. Of course we all want that, the issue is that there are long-established, clearly-defined rules for how much of your account is protected that somehow don’t apply to the rich. For you or I it’s $250,000. Need more to be whole? Too bad, suck it up, that’s the law. But VC accounts? 100% recovery sir, sorry for the trouble! >I also don't blame them for whining and complaining, likely anyone would do the same. Except until last week most of these guys were crowing about PERSONAL RESPONSIBILITY and living with your choices and how handouts and bailouts were evil in response to workers and consumers asking for anything Curiously though, when it became about their money, suddenly it’s GOVERNMENT HELP
- initplus 4y ago
  People are getting too caught up in the 250k limit. Most bank failures result in all depositors being made whole - even over the limit. Normally by regulators “hinting” that a larger bank should acquire the failing banks assets whole. FDIC exists to create faith in the banking system - no to just enforce a rule book on how deposit insurance is structured. The goal is for FDIC to never have to pay out in the first place - FDIC’s existence prevents the bank run from starting. The obvious conclusion to the 250k limit (splitting deposits between banks) doesn’t really do anything to actually reduce risk in the banking system, or risk to FDIC. Splitting deposits like this is artificial behaviour that doesn’t have any real benefits to overall stability of the economy.
  - LiquidSky 4y ago
    >People are getting too caught up in the 250k limit. Because you're engaging in the classic Hacker News behavior of a narrow technical point that misses the larger context. People aren't upset about the mechanics of the FDIC. People are upset that time after time the rich make blunder after blunder after blunder and time after time are protected from their own idiocy and hubris in circumstances where everyone else would be left to rot. The same people who, when the shoe is on the other foot, gleefully lecture everyone else about choice and consequences and patronizingly tell them to learn about better personal finance habits. You're describing the biology of an individual tree and missing the forest. You've filled this discussion with many comments all missing the bigger picture of what's going on and why people are angry about this. You can't analyze events in a vacuum.
    - listenallyall 4y ago
      And you're describing putting money in a bank as a "blunder," "idiocy" and "hubris." Which is where rational people will likely take exception with your viewpoint.
      - cbzbc 4y ago
        A bank that had a rather cavalier approach to a particular class of risks that the founders and VCs benefited from personally (mortgages, personal loans and other wealth management services at highly discounted rates).
        listenallyall 4y ago
        We're talking about a BANK here -- state & federally regulated, licensed, accredited -- not some equity investment. Bank depositors should not have to vet a risk profile before opening an account. Do you know the primary risks of the banks you do business with? Which industries they make the most loans to? What investments they've made? Do they hold the minimum deposit reserves, or more?
    - FooBarBizBazz 4y ago

LiquidSky 4y ago

>I've got no love, nor much respect for venture capitalists, but I don't see that wanting, or expecting, to get your money out of a bank account to be corrupt or hypocritical. Of course we all want that, the issue is that there are long-established, clearly-defined rules for how much of your account is protected that somehow don’t apply to the rich. For you or I it’s $250,000. Need more to be whole? Too bad, suck it up, that’s the law. But VC accounts? 100% recovery sir, sorry for the trouble! >I also don't blame them for whining and complaining, likely anyone would do the same. Except until last week most of these guys were crowing about PERSONAL RESPONSIBILITY and living with your choices and how handouts and bailouts were evil in response to workers and consumers asking for anything Curiously though, when it became about their money, suddenly it’s GOVERNMENT HELP

initplus 4y ago
People are getting too caught up in the 250k limit. Most bank failures result in all depositors being made whole - even over the limit. Normally by regulators “hinting” that a larger bank should acquire the failing banks assets whole. FDIC exists to create faith in the banking system - no to just enforce a rule book on how deposit insurance is structured. The goal is for FDIC to never have to pay out in the first place - FDIC’s existence prevents the bank run from starting. The obvious conclusion to the 250k limit (splitting deposits between banks) doesn’t really do anything to actually reduce risk in the banking system, or risk to FDIC. Splitting deposits like this is artificial behaviour that doesn’t have any real benefits to overall stability of the economy.
- LiquidSky 4y ago
  >People are getting too caught up in the 250k limit. Because you're engaging in the classic Hacker News behavior of a narrow technical point that misses the larger context. People aren't upset about the mechanics of the FDIC. People are upset that time after time the rich make blunder after blunder after blunder and time after time are protected from their own idiocy and hubris in circumstances where everyone else would be left to rot. The same people who, when the shoe is on the other foot, gleefully lecture everyone else about choice and consequences and patronizingly tell them to learn about better personal finance habits. You're describing the biology of an individual tree and missing the forest. You've filled this discussion with many comments all missing the bigger picture of what's going on and why people are angry about this. You can't analyze events in a vacuum.
  - listenallyall 4y ago
    And you're describing putting money in a bank as a "blunder," "idiocy" and "hubris." Which is where rational people will likely take exception with your viewpoint.
    - cbzbc 4y ago
      A bank that had a rather cavalier approach to a particular class of risks that the founders and VCs benefited from personally (mortgages, personal loans and other wealth management services at highly discounted rates).
      - listenallyall 4y ago
        We're talking about a BANK here -- state & federally regulated, licensed, accredited -- not some equity investment. Bank depositors should not have to vet a risk profile before opening an account. Do you know the primary risks of the banks you do business with? Which industries they make the most loans to? What investments they've made? Do they hold the minimum deposit reserves, or more?
  - FooBarBizBazz 4y ago