re: Who is paying for the uninsured deposits for SVB?

quote:

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If the Fed swaps SVPs long term assets for short term assets it’ll be close to a wash eventually.

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SVB has a bunch of fed securities that are basically trading at 60% of stated value.

The fed reserve can buy them at 100% of value, make everyone whole, and then hang on to redeem the security until it matures, making the 40% current haircut essentially meaningless.

Now, that might take 10-20 years. Ultimately, the fed has the ability to hang on that long.