flexghost.Federal authorities are seriously considering protecting all uninsured deposits at Silicon Valley Bank
With your tax dollars
Here’s my proposal: fuck you, no.
Claw back the bonuses SVB gave staff HOURS before the collapse. Then we can talk.
Alan Martello@flexghost Keep in mind that their assets (as indicated in their Call report which can be viewed here https://cdr.ffiec.gov/public/ManageFacsimiles.aspx ) are fairly low risk assets. It should be possible to quickly liquidate them all for substantial face value.
Rich people and VC backed companies will take a haircut; painful but most companies will be able to survive - and learn to do better due diligence on who is holding their money.
This is the same lesson Bernie Madoff’s investors learned.
Assumes asset sales fully cover deposits +shareholders are wiped out. That money comes from somewhere. The neoliberal take is the state is benevolent and this doesn’t effect the little guy. It does.
Investors taking 0 loss on a failed company would defeat the purpose of the stock market. Eliminating losses for owners creates incentives for capital allocation. If we decide we should socialize losses then we may as well socialize gains as well and why have a private sector?
@flexghost Looks like the Fed statement indicates shareholders and bond holders (near as I can tell from 10K a few single digit billions in bonds) will be wiped out. Any additional shortfall in making depositors whole will come from a special assessment on banks. https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312b.htm
