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Specific issues with SVB, not systemic. [1] 1. https://techcrunch.com/2023/03/09/silicon-valley-bank-firms-...
Today I learned that many startups park their money at one bank. I hope that isn’t true. If it is I’d be moving my funds regardless right now.
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How would you provide loans to help get businesses started?
How would you provide loans to people to buy their first homes?
How would you provide loans so people can afford to go to school?
How would you provide loans to buy a vehicle so people can get to/from their job before they get a paycheck?
How would farmers afford to buy land, equipment and plant crops before they got paid for selling them?
Like it or not, credit has allowed a large portion of people to get lifted out of poverty.
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This destroys the entire economy, making startups and corporations much harder to run to the point of impossibility. Even in countries run on Sharia law, they still find proxies for interest
And generally speaking you can’t honestly use those proxies to build financial skyhooks
Earlier quoted context omitted.
This is how every bank has always worked since banks were invented
Yes, but it’s pretty much always been problematic when a bank leader has had to make a statement akin to “We’re fine as long as there’s not a run”. That’s the kind of thing that only gets said when there’s some concern that there will be a run.
I just tried to login to svb.connect.com and it is giving me a popup to scan an QR code from the app. The app now gives me a popup requiring two factor auth (which it hadn’t ever before) with a phone number that I don’t have access to. I luckily don’t have much money in this account. As a bootstrapped founder, what would I need to do to get my money if SVB goes under?
This being a bit different, the most likely scenario will be SVB getting bought on the cheap by a bigger bank. The merger will be pushed by the regulator.
Since SVB's root problem is lack of diversification in client basis, a larger bank beings the perfect solution. In such a scenario SVB will continue as a brand, and their website would start working again.
Daily reminder that bank runs wouldn't be a thing if we did duration matching, forbidding banks from borrowing short and lending long. As always, the underlying problem in banking is that the banks are lying, telling two or more people they own the same dollar at the same point in time. If they locked deposits for a period of time they could safely (and morally) loan that money out without lying, and, in fact, there…
https://www.federalreserve.gov/monetarypolicy/reservereq.htm
Seems like a good opportunity for Mercury. Been using Mercury for a couple of years, as a customer I can recommend their excellent support & services. That said, I know aprox zero of their balance sheet or those of their backing banks Choice Financial Group and Evolve Bank & Trust.
But I'm not worried about Mercury, I'm worried about their partner bank.
Anyone know if Evolve is in a similar situation?