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Seems like fair warning to me. If you have a few million in a bank you may lose it. That's the law. Pretending you are going to break the law by issuing fire i
by roundandround 4y ago
Seems like fair warning to me. If you have a few million in a bank you may lose it. That's the law.
Pretending you are going to break the law by issuing fire insurance on houses that are on fire and then not doing it wouldn't really be more ethical would it?
- woeirua 4y agoBut that's what she just did with SVB...
- roundandround 4y agoShe did what she was ordered to do which is not something she could claim she was going to do as the powers of her office are not wildly out of control.
- credit_guy 4y agoIt's true, but it's possible (quite likely actually) that the Fed and the FDIC looked at SVB's balance sheet, and concluded that they can make good on all the deposits given the FDIC insurance (of $250k per depositor) plus the new funding facility that allows banks to borrow against high quality collateral valued at par, rather than fair value. It does not follow that the math will work out with every single bank that's underwater out there.