I don’t entirely agree - the depositors enjoyed higher interest rates from SVB’s risky behavior. If they face no consequences, then it will encourage instituti

I don’t entirely agree - the depositors enjoyed higher interest rates from SVB’s risky behavior. If they face no consequences, then it will encourage institutional depositors to continue flocking to whatever bank is offering the most irresponsible interest rate. We need to balance letting the depositors suffer with causing a system wide run, so I think the FDIC/Fed choice was reasonable, but I would have rather seen them, say, guarantee uninsured deposits, less the interest of those deposits earned over the past 18 months.