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I don't like the idea of millionaires who make bad decisons being bailed out either, but it's not clear that is what is happening here. Firstly not clear that
by fancyfredbot 4y ago
I don't like the idea of millionaires who make bad decisons being bailed out either, but it's not clear that is what is happening here.
Firstly not clear that this is really a bail-out in the usual sense. No tax-payer money is going to these millionaires, and any costs (if there are any, which isn't entirely clear) are going to go to other banks and their shareholders.
Secondly not clear that depositing money in SVB was a "bad decision" - doing this wasn't a risky thing VCs did to try and get rich.
- adoxyz 4y agoWon't the remaining banks just pass on those extra costs onto the customers anyway? So at the end of the day, "the people" will end up paying for the bail-outs, just with a few extra steps.
- fancyfredbot 4y agoGood question. In theory no - it's not supposed to work that way because competition between banks would prevent it. I've no idea how likely it is to happen in practice though. (Edit: But my unqualified guess is that at least some costs will indeed get passed on)