I read somewhere that over 50% of all deposits in the US are uninsured. Making SVB depositors whole had much less to do with making hapless VC's whole, and much

I read somewhere that over 50% of all deposits in the US are uninsured. Making SVB depositors whole had much less to do with making hapless VC's whole, and much more to do with preventing wide spread contagion. Also, practically speaking, the "consequences" for SVB depositors was likely that they would get a small haircut on their deposits, probably in the range of 0-10%. While not a great outcome, that by itself would not have been too problematic. The bigger issue was that getting access to those funds could take weeks or months, which would have been a huge issue for companies trying to make payroll. > Maybe these are all just indicators that the financial market has become way too complicated with risks hidden away I totally agree. And for the most part I have not seen too many folks on HN defending the SVB VC's, but more so arguing that there really is no practical reason why we can't have zero risk deposits (see discussion regarding narrow banks). And regarding the CS situation, we should also probably stop banks from selling bonds that don't really behave like bonds. At the end of the day, the vast majority of financial products can be boiled down to "get money now, pay more later" and "give money now, get more back later". And all of the complexity that gets tacked on top almost always seems to be ways of dealing/arbitraging risk. The more complexity we allow, the more likely it is someone will package and sell that risk to unsuspecting investors. We shouldn't make everyone whole when things go south, but we should absolutely correct these behaviors with regulations to prevent it from happening again.