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Started By
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re: Wall Street — not taxpayers — will pay for the SVB and Signature deposit relief plans
Posted on 3/13/23 at 8:25 am to SlowFlowPro
Posted on 3/13/23 at 8:25 am to SlowFlowPro
quote:
What killed SVB was a bank run, not an asset crisis.
This is such a critical distinction but one that can be hard to get across to folks
0
Posted on 3/13/23 at 8:25 am to Taxing Authority
quote:
SCB has assets to cover almost the entire payout. It’s just illiquid (can’t be sold fast enough to cover the run of withdrawals). The assets still exist. So the only cost will be making up the difference in the short term to cover any withdrawals. The bank was not insolvent. They just rebalanced and it started a run.
SVB also was trying to raise money from selling stock but the same psychology that led to the bank run led to a crash in the stock. It's all psychology and that's why ensuring confidence in banking, nationally, is so important.
Posted on 3/13/23 at 8:35 am to SlowFlowPro
quote:Nah. Gotta get those rich billionaires!
It's all psychology and that's why ensuring confidence in banking, nationally, is so important.
Posted on 3/13/23 at 8:42 am to SlowFlowPro
quote:
They were taken over and everything was frozen.
Should never have gotten to that point. It seems like competent leadership would have handled it better, and tried to look ahead for problems and keep things more fluid.
What killed SVB was a bank run, not an asset crisis.
That's the kind of thing that can happen at a bank, and nowadays, it can happen very fast, due to instant communications and social media.
Posted on 3/13/23 at 8:53 am to rickgrimes
quote:
This was not a bailout in any form.
Completely false
Posted on 3/13/23 at 8:53 am to DallasTiger11
How is it a bailout?
Posted on 3/13/23 at 8:54 am to auggie
quote:
Why didn't they already sell off some of these assets?
Because this collapse happened in like 48 hours.
Posted on 3/13/23 at 8:54 am to Mo Jeaux
Because there is a theoretical chance the banks pass on the costs they agreed to incur to consumers. You know, the traditional and very direct definition of bailout.
Posted on 3/13/23 at 8:56 am to rickgrimes
quote:
Wall Street — not taxpayers — will pay for the SVB and Signature deposit relief plans
Okay and how are these special assessments going to be recovered by the banks?
quote:
@FDICgov insurance fund capitalized by premiums paid by banks will absorb any losses.
That's right. They will pass it on to their customers - and that's every FDIC insured institution, not just those on Wall Street.
So this is more of a Main Street bailing out Silicon Valley situation.
Posted on 3/13/23 at 8:57 am to dewster
quote:
They will pass it on to their customers
LINK?
Posted on 3/13/23 at 9:14 am to rickgrimes
That sounds good and all but if we insure all depositors for the full amount what happens if a ton more banks start failing? We can’t afford that level of insurance. The FDIC has an insurance limit for a reason
If the cost is covered through premiums paid by banks, and banks are already strained, could it not create more bank failure? Causing a domino effect as more banks fails and more premiums on the remaining banks? Or at the least those costs get passed on to depositors in some way so we end up paying for it anyways.
I don’t agree with covering all the depositors 100%. Do the 250k for individuals and say maybe 25 or 50% for companies
If the cost is covered through premiums paid by banks, and banks are already strained, could it not create more bank failure? Causing a domino effect as more banks fails and more premiums on the remaining banks? Or at the least those costs get passed on to depositors in some way so we end up paying for it anyways.
I don’t agree with covering all the depositors 100%. Do the 250k for individuals and say maybe 25 or 50% for companies
Posted on 3/13/23 at 9:17 am to deltaland
quote:
That sounds good and all but if we insure all depositors for the full amount what happens if a ton more banks start failing? We can’t afford that level of insurance. The FDIC has an insurance limit for a reason
Dude think about what you just said.
If a ton of banks start failing, FDIC can't insure shite for any of them.
The entire point of this move is to inject confidence in consumers to not make multiple banks start failing.
You know how a bank can't survive a bank run? The FDIC can't survive a rash of bank failures, either.
quote:
If the cost is covered through premiums paid by banks, and banks are already strained, could it not create more bank failure?
SVB failed because of a run on the bank. They're still solvent.
Posted on 3/13/23 at 9:32 am to SlowFlowPro
quote:
LINK
You need a link to tell you that companies will pass on regulatory and overhead costs to customers?
Did you take any economics classes in undergrad?
Posted on 3/13/23 at 9:33 am to rickgrimes
quote:
Wall Street — not taxpayers — will pay for the SVB and Signature deposit relief plans
What is “Wall Streets” EIN or Social Security number? That’s right, “Wall Street” isn’t an entity that has anyway of making anything whole. Only people can. People - period. Now who are the people behind this magic place you call “Wall Street” - the American people.
You can eat up all the BS spin you want but at the end of the day the people of this country will once again be on the hook for yet another instance where Joe Biden and his team screwed up. Maybe if they were more focused on there jobs than deciding which gender they are and which orifice they were going to put a stranger penis in this wouldn’t be happening so much.
Posted on 3/13/23 at 9:34 am to rickgrimes
frick off “Wall Street”. You gonna bail me out if I default on my line of credit?
Posted on 3/13/23 at 9:38 am to rickgrimes
quote:
Wall Street — not taxpayers — will pay
Posted on 3/13/23 at 9:47 am to rickgrimes
quote:
Wall Street — not taxpayers — will pay for the SVB
You serious Clark?
This is Bill Ackman, the last person we should trust.
He's telling the public to calm down and not panic. What does this tell you?
He's probably turning around at the same time and telling his fund managers to quietly liquidate all relevant assets off their books.
Come on bro.
Posted on 3/13/23 at 2:21 pm to Mo Jeaux
quote:
How is it a bailout?
The Fed's new program allowing the survivors to loan their debt securities at par value is a bail out
Posted on 3/13/23 at 2:22 pm to auggie
quote:
they already sell off some of these assets?
Several reasons, here's a few:
Signals to markets that something up.
Assets are illiquid
Even they didn't realize how bad it was until it was too late
Posted on 3/13/23 at 2:24 pm to rickgrimes
Somehow the Biden Crime Family got 10% of the cash transfer.
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