4 ms·

Since the regulations "changed" to enable the bailout, you may have a good case to sue the Fed and the Treasury for some portion of your expected profits, no?

gsibble 4y ago
Ha! Now there's an idea.
deleted 4y ago
[deleted]
amanj41 4y ago
In a real bailout wouldn't SVB continue to exist?
- anonymouskimmer 4y ago
  My POV too. I was listening to Bloomberg radio yesterday and the people were all talking about if this is a bailout, and if voters would see it as a bailout. I thought the reason people were pissed at the 2008 bailouts because the actual too-big-to-fail corporations (less Lehman and WaMu) were enabled to continue existing, with their shareholders still owning part of the corporations. Here it's only the depositors who are being made whole.
  - whitemary 4y ago
    > I thought the reason people were pissed at the 2008 bailouts because the actual too-big-to-fail corporations (less Lehman and WaMu) were enabled to continue existing, with their shareholders still owning part of the corporations. Struggling to take you in good faith, you're wrong either way. Working people were pissed about the 2008 bailout because they were left empty-handed while Wall Street banks and CEOs got bailed out. Your comparison falls flat because there are no working people involved in the SVB situation.
    - anonymouskimmer 4y ago
      Well sure, of course. I don't understand why you are "struggling" to take me in good faith because I left out the part about struggling people. I don't remember it off the top of my head because my financial situation at the time was such that I was so low I didn't have to worry about losing a home or other assets (all I had was a really cheap car, a low end computer, my bed and couch were inflatable). > Your comparison falls flat because there are no working people involved in the SVB situation. Sure there are plenty of people dependent on SVB deposits for their paychecks. And it sucks to be an SVB employee. But the shareholders are effectively wiped out, unless and until SVB's assets are eventually sold for more than its liabilities.
      - whitemary 4y ago
        You can think whatever you want, but regular working American people, in aggregate, do not consider themselves as having anything at all in common with anyone remotely associated with Silicon Valley startups, which are universally despised by the American people at large. The fact that nobody in Silicon Valley has ever appeared to care what they think until now makes it even worse. These sentiments are so entrenched that this will not change for at least a few generations in the best case. It's just way too late.
        anonymouskimmer 4y ago
        Being pissed off or feeling despite takes more effort than just not caring. I'm annoyed at the support for Carnival and other cruise lines during the early days of the COVID pandemic. I even sent an email (which was answered) to the local Fed branch saying that they should backstop consumer credit card debt the way they were backstopping corporate loans.
- chernevik 4y ago
  A "bailout" is a mitigation of consequences, generally supported by an injection of cash or a guarantee thereof. It can apply to any class of interests in an enterprise. "Shareholders were bailed", "bondholders were bailed out", "depositors were bailed" -- these are all possible sentences. Shareholder bailouts are the worst but there are negative consequences to all cases.
themitigating 4y ago
And where does the government get money from?
- chernevik 4y ago
  In this case, from assessments on other banks insured by the FDIC. It can be reasonably presumed that these costs, like any other business cost, will somehow be passed on to those banks' customers.
  - themitigating 4y ago
    That's what I was implying.
    - chernevik 4y ago
      sorry
awkward 4y ago
The man built a plan to buy other people's money at a discount while they're in distress. He can frame it as pro-socially as he wants, but the taxpayer is absolutely not on the hook for that kind of vulture hedge fund shit.
- gsibble 4y ago
  I'm definitely not saying I need a bailout. And we were offering 90-95 cents on the dollar while banks and hedge funds were offering 60-70.
  - awkward 4y ago
    Good! That'd keep most businesses in one piece.
    - gsibble 4y ago
      That was our goal. Not to make a profit but to save the ecosystem.
daenney 4y ago
Regulations didn't change. The fund they tapped to protect all depositors exists since the financial crisis of 2008. To avoid another global meltdown.
- h2odragon 4y ago
  I've read that what changed was the definition of "systemically important" which allowed access to that fund. I put quotes around "changed" for that reason. However; if FDIC insurance is not now effectively unlimited, if the next bank that folds get the old limits imposed, then there's going to be some real shouting. And this method of raising those limits sucks and will almost certainly see court.

gsibble 4y ago

Ha! Now there's an idea.

deleted 4y ago

[deleted]

amanj41 4y ago

In a real bailout wouldn't SVB continue to exist?

anonymouskimmer 4y ago
My POV too. I was listening to Bloomberg radio yesterday and the people were all talking about if this is a bailout, and if voters would see it as a bailout. I thought the reason people were pissed at the 2008 bailouts because the actual too-big-to-fail corporations (less Lehman and WaMu) were enabled to continue existing, with their shareholders still owning part of the corporations. Here it's only the depositors who are being made whole.
- whitemary 4y ago
  > I thought the reason people were pissed at the 2008 bailouts because the actual too-big-to-fail corporations (less Lehman and WaMu) were enabled to continue existing, with their shareholders still owning part of the corporations. Struggling to take you in good faith, you're wrong either way. Working people were pissed about the 2008 bailout because they were left empty-handed while Wall Street banks and CEOs got bailed out. Your comparison falls flat because there are no working people involved in the SVB situation.
  - anonymouskimmer 4y ago
    Well sure, of course. I don't understand why you are "struggling" to take me in good faith because I left out the part about struggling people. I don't remember it off the top of my head because my financial situation at the time was such that I was so low I didn't have to worry about losing a home or other assets (all I had was a really cheap car, a low end computer, my bed and couch were inflatable). > Your comparison falls flat because there are no working people involved in the SVB situation. Sure there are plenty of people dependent on SVB deposits for their paychecks. And it sucks to be an SVB employee. But the shareholders are effectively wiped out, unless and until SVB's assets are eventually sold for more than its liabilities.
    - whitemary 4y ago
      You can think whatever you want, but regular working American people, in aggregate, do not consider themselves as having anything at all in common with anyone remotely associated with Silicon Valley startups, which are universally despised by the American people at large. The fact that nobody in Silicon Valley has ever appeared to care what they think until now makes it even worse. These sentiments are so entrenched that this will not change for at least a few generations in the best case. It's just way too late.
      - anonymouskimmer 4y ago
        Being pissed off or feeling despite takes more effort than just not caring. I'm annoyed at the support for Carnival and other cruise lines during the early days of the COVID pandemic. I even sent an email (which was answered) to the local Fed branch saying that they should backstop consumer credit card debt the way they were backstopping corporate loans.
chernevik 4y ago
A "bailout" is a mitigation of consequences, generally supported by an injection of cash or a guarantee thereof. It can apply to any class of interests in an enterprise. "Shareholders were bailed", "bondholders were bailed out", "depositors were bailed" -- these are all possible sentences. Shareholder bailouts are the worst but there are negative consequences to all cases.

themitigating 4y ago

And where does the government get money from?

chernevik 4y ago
In this case, from assessments on other banks insured by the FDIC. It can be reasonably presumed that these costs, like any other business cost, will somehow be passed on to those banks' customers.
- themitigating 4y ago
  That's what I was implying.
  - chernevik 4y ago
    sorry

awkward 4y ago

The man built a plan to buy other people's money at a discount while they're in distress. He can frame it as pro-socially as he wants, but the taxpayer is absolutely not on the hook for that kind of vulture hedge fund shit.

gsibble 4y ago
I'm definitely not saying I need a bailout. And we were offering 90-95 cents on the dollar while banks and hedge funds were offering 60-70.
- awkward 4y ago
  Good! That'd keep most businesses in one piece.
  - gsibble 4y ago
    That was our goal. Not to make a profit but to save the ecosystem.

daenney 4y ago

Regulations didn't change. The fund they tapped to protect all depositors exists since the financial crisis of 2008. To avoid another global meltdown.

h2odragon 4y ago
I've read that what changed was the definition of "systemically important" which allowed access to that fund. I put quotes around "changed" for that reason. However; if FDIC insurance is not now effectively unlimited, if the next bank that folds get the old limits imposed, then there's going to be some real shouting. And this method of raising those limits sucks and will almost certainly see court.