Quote:
Originally Posted by TwistedChief
Of course you should. Absolutely. Though if you choose to do it, you’re likely safer with a Chase, Citi, or BOA.
And guys, re: the 1.3%. You do realize that during the largest financial crisis of our lives no depositors whether insured or uninsured lost money, right? Despite several hundred bank failures? There are assets against these bank deposits. And banks are so much more heavily regulated now than they had been (though a former unnamed president watered down regulations for smaller banks).
This SVB situation is super niche. They just did every stupid thing you could’ve done given their structure. Total mismanagement.
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Am I understanding it right that they had a pissload of capital tied up in long term bonds that when the interest rate rose they lost value? Then they needed to raise capital and that's when the VC's all told their clients to GTFO and started the run on the bank?
It seems weird to me that a bank of all placed would tie up capital for the long term. I know that when interest rates didn't move for basically 20 years, it would be easy to get out of them, but as inflation poked up on the horizon (long before rates took off) that they would have unwound them, at least some of them.
I'm an idiot, but that's the way I see it.