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SVB chief pressed lawmakers to weaken bank risk regulations

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Re: SVB chief pressed lawmakers to weaken bank risk regulations

#81

Post by [deleted] »

mrkurt wrote: post #32
lp0_on_fire wrote: post #20

Earlier quoted context omitted.

> Also, SVB depositors weren’t just random individuals, they are some of the wealthiest people and organizations in the country or even the world. They are going to leverage their power and influence to recover as much as they can as quickly as they can. All the more reason regular people need to be screaming to high heaven that those rich and powerful people will get eaten if they push for and eventually receive a b…

There's no bailout. SVB is dead. People are pushing for depositors to get their money back. Which is, I think, reasonable. Putting your company money in a bank account should be safe. We should regulate banks like SVB to make it more safe. We should also make sure when the regulations fail the people who use a bank, they can continue doing business.

[deleted]

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#82

Post by sillybov3456 »

nouveaux wrote: post #77
NordSteve wrote: post #53

Earlier quoted context omitted.

Startups have to do risk management all of the time -- it's a core activity of entrepreneurship. Can we trust this vendor? Is this new hire going to work out? Will this API vendor scale to what we need/be around in the future? Finance is no different. There are no "safe" investments, only varying levels of risk and reward. Mitigating the risk of a single bank failure locking up your $2MM raise is a couple hours of wo…

Putting money in a bank is risk management.

Respectfully, it's not. Choosing a bank is an aspect of risk management, the act of throwing all your money into whatever thing that calls itself a bank and is most convenient is not risk management, it's risky behavior.

Risk management would be asking the question "should I be putting all my eggs in a basket that seems very tied to the tech economy / northern California real estate market / low interest rates?". Diversification would be trying to get the money you use to pay your tech workers invested in something as far away from tech as possible.

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#83

Post by [deleted] »

waboremo wrote: post #9
mistrial9 wrote: post #2

with no dog in this fight, I see this as some enforcement grudge match from NY capital old-school on California capital new-school, triggered by zero tolerance for crypto. IMO - almost all the leveraged finance in the last 20 years is already over-the-top and mostly "fake money".. who gets the axe first is politics. Supporting statement to this heresy? When the "real economy" tanked due to covid-19 lockdown, the pape…

The fact that you've never heard of Roku doesn't really say much other than you either living in a country where Roku is not available, or living under a rock. Roku tends to get a lot of retail space, so if you've walked through any walmart electronic section, or bestbuy, or whatever you're guaranteed to see them. Before smart TVs took off there was only Apple TV and Roku. No Chromecasts or Fire Sticks. Meaning if yo…

[deleted]

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#84

Post by lisasays »

azinman2 wrote: post #78
lisasays wrote: post #72

Earlier quoted context omitted.

The thing is, it isn't "people" arguing that -- to an extent that would suffice influence policy, in any case. By itself, this belief contingent (and its effect on public policy) would be quite marginal. At the end of the day, it's lobbyists, PACs and think tanks connected to specific business interests who are able to work the system, and get these marginal political beliefs converted into legislation (and court app…

And they convince millions of people it’s the right thing to do, so they keep getting voted in on it. It appeals to existing political mindsets. You can’t ignore the politicalization of it.

That's exactly how they operate - by trying to convince everyone that it's the inevitable result of the groundswell of public opinion in favor of aggressive regulation.

In reality, it isn't.

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#85

Post by nico »

boeingUH60 wrote: post #46
MrMan wrote: post #38

Earlier quoted context omitted.

depositors are only entitled to what is left over after resolution of the assets, nothing more! dont make this situation worse by advocating for something unethical and which is bad for the entire system

Of course, that is likely what they're getting. People with sub-$250k will be taken care of by the FDIC as expected and the $250k+ depositors will be made whole from the proceeds of asset sales (bonds, securities, et al) held by Silicon Valley Bank. I really don't think the U.S. government will step in to provide additional funds. It's also possible that the FDIC might sell the remnants of Silicon Valley Bank to a la…

> I really don't think the U.S. government will step in to provide additional funds.

If it was some small bank that was only impacting “regular people”, then probably the government would not do anything.

But that is not the case here. The depositors of SVB are very wealthy and powerful. Also the standard process of selling assets is too slow, and that delay could create a catastrophic domino effect. Famous investors are already calling for the government to fix the issue within 48hrs.

Maybe the government will step in as a temporary lender, letting depositors borrow against their deposits, which they will eventually get back.

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#86

Post by simfree »

salawat wrote: post #75
lp0_on_fire wrote: post #45

Earlier quoted context omitted.

Every bank account in the United States is insured up to $250,000 by the FDIC. I have zero sympathy for these depositors who decided it would be "too costly" or "too much hassle" to split their deposits into multiple accounts. If you've got $25,000,000 dollars at SVB, you need 100 accounts. This is not rocket science. I really hope that they find a buyer to make depositors whole but if one cannot be found why should…

Incorrect. Every depositor has 1 account per account type per institution insured up to 250k. If you had 100 accounts of the same type at the same institution, you're still only getting 250k back from the FDIC. To do what you're proposing, you'd have to have 100 accounts at different FDIC insured institutions. The logistics there is vastly different, but meshes quite well with designing for fault tolerance/resilience…

Brex offers a product to do this for you IIRC?

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#87

Post by dalyons »

mangosteenjuice wrote: post #47
mrkurt wrote: post #32

Earlier quoted context omitted.

There's no bailout. SVB is dead. People are pushing for depositors to get their money back. Which is, I think, reasonable. Putting your company money in a bank account should be safe. We should regulate banks like SVB to make it more safe. We should also make sure when the regulations fail the people who use a bank, they can continue doing business.

It is a bailout for any amount over $250,000

It’s really not. They have assets.

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#88

Post by nouveaux »

sillybov3456 wrote: post #82
nouveaux wrote: post #77

Earlier quoted context omitted.

Putting money in a bank is risk management.

Respectfully, it's not. Choosing a bank is an aspect of risk management, the act of throwing all your money into whatever thing that calls itself a bank and is most convenient is not risk management, it's risky behavior. Risk management would be asking the question "should I be putting all my eggs in a basket that seems very tied to the tech economy / northern California real estate market / low interest rates?". Div…

Putting money in a bank is a form of risk management. A startup can choose to:

* Buy expensive office equipment or put it in a bank

* Go on a hiring spree or put it in a bank

* Acquire another company or put it in a bank

* Put money in crypto or put it in a bank

Shopping for a bank might mitigate a bit more of your risk. Putting it inside of a bank is low risk compared to the many things you can do with money.

Hundreds of thousands of businesses store more than $250k in a bank and for most of them, the largest risk to their business is not their bank.

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#89

Post by theGnuMe »

lapcat wrote: post #63

How we get bipartisan corruption: • Lack of public financing for political campaigns. • Lesser of two evils thinking, where each party gives their own politicians a pass because "the other side is worse". • Corporate consolidation of the news media, where the culture and even the personnel of reporting and politics are interchangeable. • "Success" (AKA greed is good) as a national ethos, with no pushback from religio…

Evangelical Jesus is the Profit.

Re: SVB chief pressed lawmakers to weaken bank risk regulations

#90

Post by fuzzfactor »

boeingUH60 wrote: post #50
mistrial9 wrote: post #2

with no dog in this fight, I see this as some enforcement grudge match from NY capital old-school on California capital new-school, triggered by zero tolerance for crypto. IMO - almost all the leveraged finance in the last 20 years is already over-the-top and mostly "fake money".. who gets the axe first is politics. Supporting statement to this heresy? When the "real economy" tanked due to covid-19 lockdown, the pape…

> Roku (who I have never heard of as a consumer) had two Billion USD in cash ? wtf This is arrogant. There are many billion-dollar businesses you haven't heard of, most of them in boring industries. For instance, have you heard of Vitol? Likely not...but they made $279bn in revenue in 2021. https://www.vitol.com/vitol-2021-volumes-and-review/

There's always been money in streaming when you're doing it with pipelines, ships, and barges.

Sure it takes decades but this was a startup financed by a small family loan, rather than true venture capital that could more realistically be considered "Other People's Money".

So they get to be private, start their exponential growth from a much more retarded point, and have to leverage other people's pipelines, ships, and barges or it wouldn't work.

Even in a capitalist market, enough strength can sometimes be built without other people's money, that it can be an unfair advantage compared to the capital-bound operators making up the majority of the market itself.

Entrepreneurialism != Capitalism.

With Roku I heard of it here and it turns out I had a pretty good idea about their streaming. But no further interest other than to see how they do financially over the years, as a spectator.

I'm hardly a consumer at all.

So definitely didn't find out about Roku as a consumer.

But before I knew it my brother got one, he consumes that stuff and now I'm more familiar than I wanted to be.

I would actually call it kind of boring myself.

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