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How do you think your bank would fare if everyone who has uninsured money in it pulled it all out tomorrow? The proven with the "let the people who made poor d
by brookst 4y ago
How do you think your bank would fare if everyone who has uninsured money in it pulled it all out tomorrow?
The proven with the "let the people who made poor decisions lie in the bed they made" is that it creates a panic where they lght our beds on fire. Maybe we "deserve" it too, but that doesn't seem like great public policy.
- EMM_386 4y agoI never suggested that the depositors should lose their money. They should have known about the 250k limit and not exceeded it in the first place, but I didn't say they should lose their money. I said the cap is irrelevant. Everyone with SVB got all their money back. Even if you had $20 million in the account at SVB, you got it back. When, technically, you are only supposed to get back $250k. So the rule is applied arbitrarily, depending on what is or is not a "systemic risk". If a rural bank fails and people have more than 250k in their accounts, they will lose it. If SVB or First Republic fails, they won't. This case is a little different in that JP Morgan bought the whole thing. Which is just leading to further consolidation in the really TBTF banks.