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> Why is it OK to bail out the Silicon Valley bank but not this one? 1) Because SVB paid at least some money into the FDIC insurance fund. 2) Because SVB's de
by anonymouskimmer 4y ago
> Why is it OK to bail out the Silicon Valley bank but not this one?
1) Because SVB paid at least some money into the FDIC insurance fund.
2) Because SVB's deposits are mostly backed with still viable investments, and do not require an extended clawback process that will only ever get a certain fraction of the funds back.
- matheusmoreira 4y agoIrrelevant. The whole point is to protect the blameless depositors, right? Then bail them out regardless of circumstances. Use taxpayer money to do it if necessary. Nobody cares whether the bank paid the insurance thing or not. What matters is avoiding financial calimity brought by the consequences of people's own choices.
- anonymouskimmer 4y ago> The whole point is to protect the blameless depositors, right? No. Otherwise people who lose their belongings to theft would be reimbursed by the government. > What matters is avoiding financial calimity brought by the consequences of people's own choices. If FTX depositors can show that their losses mean that businesses will have to shut down, then they can probably twist the arm of politicians to make them whole with taxpayer funds. If they can't, then they're SOL like the rest of us.