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Urgent: Sign the petition now

ycombinator.com

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Re: Urgent: Sign the petition now

#581

Post by downvotetruth »

cmurf wrote: post #284
tikkun wrote: post #157

Earlier quoted context omitted.

Disagree. People who invested in SVB should be wiped out, probably. People who deposited in SVB should not be wiped out. Depositors in banks aren't expected to do due diligence on the financial statements of the bank they're depositing in. Have you read the 10-K filings of your bank in detail?

Correct. The $250,000 FDIC cap is a favor to banks. They only pay fees to insure up to that amount. And it's bogus. The FDIC should require deposits to be insured, no matter the amount.

I'm not going to pay to insure a millionaire. Insurance is not free.

Re: Urgent: Sign the petition now

#582

Post by haiti_outlaw »

nmalaguti wrote: post #471
garry wrote: post #144

Earlier quoted context omitted.

The equity holders and management of SVB are likely to be wiped. In the petition we specifically call this out: we are not asking for their risks to be "socialized." Depositors have a reasonable expectation that when they choose a bank (especially a publicly traded bank that is regulated) that their deposits are safe. If this is not true, then most people will only bank with the largest banks. That's not a good situa…

Why not let the market sort it out? Maybe these startups need to take a down round, or be acquired for a fraction of their value? Maybe the VCs should step in and make bridge loans available if they want to keep their investments? If you believe in your portfolio, why not help them weather the storm? Or are you afraid to be exposed to additional risk? Should the taxpayers take on that risk instead?

> Why not let the market sort it out? Maybe these startups need to take a down round, or be acquired for a fraction of their value?

This is actually the right answer. Something something founders deserve their money because they take on all the risk.

Well, since we all love capitalism and meritocracy so damn much, let's see those at play for once, shall we?

Re: Urgent: Sign the petition now

#583

Post by somsak2 »

peteforde wrote: post #482

YC has taken significant positions in their portfolio companies, which they rightfully boast are worth something like a collective $140B. They've also strongly encouraged their portfolio founders to use SVB, which made sense until the precise moment it didn't. What I don't understand is why YC itself doesn't allocate what appears to be a painful but survivable amount of its profits and bail out its own portfolio comp…

surely you're not suggesting that bailing out companies they've invested in should be considered part of the a giving pledge? how would that be at all philanthropic? that's just self-interest.

Re: Urgent: Sign the petition now

#584

Post by muzz »

hendzen wrote: post #310
garry wrote: post #144

Earlier quoted context omitted.

The equity holders and management of SVB are likely to be wiped. In the petition we specifically call this out: we are not asking for their risks to be "socialized." Depositors have a reasonable expectation that when they choose a bank (especially a publicly traded bank that is regulated) that their deposits are safe. If this is not true, then most people will only bank with the largest banks. That's not a good situa…

I would be happy to support a bailout of SVB in exchange for some reasonable concessions to American taxpayers. 1) Skin in the game - GPs of YC / a16z / Sequoia / Founders Fund / etc put in some equity in to a joint venture to acquire SVB's assets and make depositors whole. Government will backstop some portion of it. 2) YC / a16z / Sequoia / Founders Fund / etc agree to support ending the carried interest tax exempt…

Many people would would support this, however what's being proposed is a pure money grab of taxpayers money

Re: Urgent: Sign the petition now

#585

Post by none_to_remain »

zozbot234 wrote: post #110

Do note, the letter is not asking for a bailout for SVB "equity holders or managers". In the worst case, they can still have their stake be wiped out completely (so a whole lot stricter than what happened in the 2008 crisis). They're just saying that the FDIC's $250k limit is not enough. The FDIC has insured larger sums than their previously stated limits before, that's how the $250k limit reached its value in the fi…

They were aware of the FDIC's terms

Re: Urgent: Sign the petition now

#586

Post by fbdab103 »

doh wrote: post #117
School-Cotton wrote: post #63

Earlier quoted context omitted.

Source for SVB lobbying against banking regulations?

“In 2015, SVB President Greg Becker submitted a statement [0] to a Senate panel pushing legislators to exempt more banks – including his own – from new regulations passed in the wake of the 2008 financial crisis.” [0] https://www.govinfo.gov/content/pkg/CHRG-114shrg94375/pdf/CH...

Completely unrelated to anything, but why was this document scanned by a potato? They do not keep the original electronic version?

Re: Urgent: Sign the petition now

#587

Post by downvotetruth »

popol12 wrote: post #537
Ekaros wrote: post #364

Earlier quoted context omitted.

Chose to exceed that and also not diversify at the same time. In my mind they have only themselves to blame. They could have gotten one or two more accounts if they are legitimate businesses.

What if you have 3 billions to deposit, like Circle ? Open 1200 accounts in 1200 different banks ?

You want to play at a risky bank, you get to pay for risky insurance.

Re: Urgent: Sign the petition now

#588

Post by muzz »

nmalaguti wrote: post #471
garry wrote: post #144

Earlier quoted context omitted.

The equity holders and management of SVB are likely to be wiped. In the petition we specifically call this out: we are not asking for their risks to be "socialized." Depositors have a reasonable expectation that when they choose a bank (especially a publicly traded bank that is regulated) that their deposits are safe. If this is not true, then most people will only bank with the largest banks. That's not a good situa…

Why not let the market sort it out? Maybe these startups need to take a down round, or be acquired for a fraction of their value? Maybe the VCs should step in and make bridge loans available if they want to keep their investments? If you believe in your portfolio, why not help them weather the storm? Or are you afraid to be exposed to additional risk? Should the taxpayers take on that risk instead?

Indeed, VCs bridge startups all the time. There are other mechanisms available also-- hedge funds are willing to pay 80 cents on the dollar for these deposits (indicating that they expect to recover more than that)

Re: Urgent: Sign the petition now

#589

Post by Rury »

garry wrote: post #443
standapart wrote: post #293

Earlier quoted context omitted.

With all respect, Garry: YC is to blame for the consolidation of this risk in a single counterparty. Those who led all these entities from the same industry to bank at the same place must be held accountable too.

This isn't some sort of complex bid call option strategy. This is a checking account, and one choice out of many that founders make regularly. To my knowledge SVB was never required, and startups always had choice.

You're asking for taxpayers to pay for depositors losing their stash. Why should others be responsible to pay for the irresponsibility here? We all take a risk when it comes to storing/investing our money. Same could happen to anyone. Depositors should have been more responsible, and taken better precautions - like by not storing everything in one account, at one institution. So depositors are also in part to blame (certainly more so than taxpayers who have nothing to do with SIVB), even if the culpability mostly lies with the management at SIVB.
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