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Well maybe we can claw back the bonuses. You're right and I did think a bit on that after writing the comment. But there should be a clear incentive still to no

Well maybe we can claw back the bonuses. You're right and I did think a bit on that after writing the comment. But there should be a clear incentive still to not go bankrupt and make their shares they hold worthless. With or without making depositors whole via ramping up the printer, your scenario still would make sense since even without the Fed backing, they could still just walk away couldn't they. The depositors would be left to sue to return the funds no? I've seen some good arguments to cover 100% of the deposits, but actually _regulate_ the banks instead of allowing their yolo fest.

lxgr 3y ago
> But there should be a clear incentive still to not go bankrupt and make their shares they hold worthless. Absolutely. I just can't think of a good mechanism to implement it in the current framework. Maybe bonus payouts should be held in escrow/be otherwise claw-back-able for some time? The only instance of clawing back dividends that I'm aware of is, ironically, Wirecard – I believe there is an ongoing lawsuit to claw back dividend payments from investors. (The irony is that the German government/regulator were actively prosecuting journalists and short sellers back when the line was trending up, yet now German courts are effectively holding long investors liable for Wirecard's fraud.)