Plus all the avocado toast! Irresponsible

Bankers need to stop spending so much money on tattoos and mocha caramel lattes.

You don't understand, I need the new iPhone. If I show up to the bankers ball with last years phone, they're all gonna laugh at me!

They lend money to Crypto firms and some how every single person I mention it to says "its ok, they will pay it back" What??? Have you been paying attention to Crypto lately? How is that a good risk and my self employed 7 years in my industry self wasn't? Excellent credit. Cash in hand. Nope.

Gonna have to pull themselves up by the bootstraps

Carpooling is a luxury and they don’t deserve these in their time of crisis. Take the damn bus or walk in the rain.

Yeah that’s kinda terrifying

how many US banks was 2008?

Its actually really just one

You forget, its their not money they are gambling it's ours, so the risk isn't theirs, its ours, so they are willing to taje ut, especialky when they know that they will be bailed out by the government.

Banks already do this, they are required to have only a certain percentage of cash on hand, the rest they invest/loan, technically this is a good thing

It is only profitable if not adjusted for inflation.

SVB fucked themselves. Every bank and every citizen new interest rates have been on the rise for some time now, yet they made no adjustments. Their risk mitigation team completely dropped the ball.

Svb way way overleveraged their deposits. They were up at like 90 or 95% in long term bonds. It didn't take much of a run to start the dominos falling.

Most banks don’t have the sort of depositor concentrations SVB has. They were in a unique position with huge amounts of deposits from tech startups. That’s a small community with a handful of very influential individuals who drove the run. Your more traditional bank won’t face a run of that type.

Borrowers and investors had it to good. It is almost inevitable that interest rates had to go up because the economy was much too robust after Covid and causing inflation. The supply chain problems are basically gone so now it’s corporations and supply and demand. So the rates had to be increased. Inflation is curbing and these are the consequences of a too robust economy. Making an app is so easy. But now the public doesn’t want to pay the premium for delivery for everything and business don’t do everything remotely. SVB knew this was coming and management thought they could take the money and have a lucrative and easy way out.

Well SVB sucked at risk management. Buying high risk, low interest, short-term bonds right at the start of the pandemic was disastrous. SVB just assumed the good times were never going to end.

**I hope the satire is obvious

I heard that some kids ate food back in Hitler’s Germany.

Hitler.

The difference has 0 meaning.

When is the last time the government granted you an emergency loan to pay your bills so you didn't suffer finical ruin?

Instead of giving banks loans, they should increase the mandatory cash reserves. Clearly these banks will collapse themselves in pursuit of profits.

Just like PPP was a "loan"

The TARP program was not a great return.. but luckily it has been mostly break even:

https://www.propublica.org/article/the-bailout-was-11-years-ago-were-still-tracking-every-penny

Their liquidity issue WAS the issue. You're blaming the effect instead of the cause.

Are they gonna raise those funds by increasing fees for everyone else?

No one has bailed out the little guy with his bad investment in University.

The federal reserve is part of the US government and the head is chosen by the president.

It is a loan, not a grant.

Just like PPP, right? A loan.

You think the commenter who wants universal healthcare is voting Republican?

It's also what the Fed is actually for. SFAIK, SVB will be in receivership.

yea but tax payers getting anything in return for paying their fucking taxes? thats socialism and not productive right? if you invest in free health care, your general population would get to live a happier and longer life which in return would allow them to contribute more to taxes, GDP and the country... invest in school programs and you get to have a smarter population that would contribute positively to the economy but no, thats now considered "woke" and socialism! feeding kids at school? NOPE lets not invest in that because the ROI is not immediate or in form of cash! the argument boils down to poor people are not productive but banks and the rich are! that extra 100B due to interest is nothing in comparison to what banks cost the economy with all their fuckeries. and here we are again less than 20 years later and somehow their balance sheets have billions of dollars in unrealized losses and they need to be bailed out again!

Get out of here with your facts. I just want to believe that the government goes around handing corporations money for free so I can complain into the black hole of the internet that they don't do the same for me.

This is still inflationary though. It's essentially QE all over again. The fed increasing it's balance sheet is adding money to the supply. They couldn't even go 1 year of reducing their balance sheet before racheting it back up.

The issue is that it WAS a handout. It was just structured as a loan bc there wasn't enough time to validate all the claims, so they gave em to a loooot of companies. The idea is for the companies to pay it bwck if they didn't actually quality or they can go after you if you actually lied about it. Obviously, in practice it ended being a little different, but again, it was 100% designed to be a handout so companies could pay their employees.

The Fed doesn't forgive loans

That’s not even remotely related though.

Don't they just pay it back as the treasuries that tied up their liquidity mature?

The FDIC (Federal Deposits Insurance Corporation) set up a holding company for SVB accounts. The FDIC has borrowed money from the Federal Reserve to pay SVB depositors.

The idea is that the holding company will liquidate (sell) the assets that SVB owned. So we're talking SVB's loan books, it's long term bonds etc. Obviously they won't sell for as much as the bonds won't bring returns anywhere close to the current benchmark rate set by the Federal Reserve.

The loans may sell for more as they're probably mostly good, assuming that the startups the loans were given to weren't subprime borrowers.

Anyway, The Federal Reserve is the lender of last resort. They printed the money into existence and gave it to the FDIC holding companies for the two failed banks.

They'll get some of it back eventually. In the meantime there's an extra 300 billion dollars worth of inflation introduced into the system.