Every single bank in America has this vulnerability, so unless you wish to bring down the entire banking system, this is the only solution.
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Yes, I expect he will face criminal charges of insider trading.
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I really enjoy this podcast and they have some interesting insight on the SVB situation.
Some were saying there were signs months ago. Better oversight was lacking if true.
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Are the fed and treasury once again saving us from their questionable policies? 
we seem to be losing the ability to see the consequences of poor policies before we are bludgeoned by them. Not a good place to be.
If the government backstops all the banks, wouldnât they be incentivized to take on more risks to generate higher profits? Sure, there would be more regulations after this round of bailouts, but as we know from history, banks and politicians would be lobbying to weaken those regulations once the current crisis becomes a distant memory. Another banking crisis, and likely a greater crisis, wouldnât be far awayâŠ
All banks are profit oriented. Most bank executives have compensation tied to bank performance.
Yes, theyâre incentivize to take on more risks. The risk/reward tradeoff is never properly balanced for the executives and shareholders. Itâs obviously different for debt holders and depositors, but they generally donât have a say in how the banks are run.
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Hardly. It was enacted as a result of the crisis. Banks failed. People lost money. God forbid VCs lose a penny these days. Totally different environment today. Itâs hard to not get political but MHO is that SVB was not a âsystem disruptorâ - system would have been just fine had SVB been allowed to fail. And the reason its depositors were saved? Hard lobby from SV - quid pro quo, if you will. VCs most vocal about a bailout and begging for one or the 'system will collapse", causing more damage and inciting fear of bank runs. Sure, there are those too big to fail, but SVB wasnât one of them. Interesting turn of events when the âdecentralize moneyâ crowd begs for gov. help.
Fascinating times.
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And Signature bank?
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From Axios: âItâs worth noting this is nothing radical or new. Uninsured depositors have been paid out in full in every bank failure in living memory, with just one exception â IndyMac, in 2008.â
https://www.axios.com/2023/03/13/let-the-bailout-debate-begin-silicon-valley-bank-fdic
Banking stocks are being hit hard today even with the bailout and other regional banks are under pressure. If the Fed hadnât taken action, I suspect weâd be seeing other banks failing this week.
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If you want to focus on whatâs next please consider the banking industries exposure to commercial real estate and the growing trend amongst borrowers to default on their loans as cities fail to draw workers back.
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We can sit here all day and cherry pick. Itâs also hard to have an honest conversation in back and forth threads. The crux of the matter is itâs a system based on the creation of credit in perpetuity or banks cease to exist. Consolidation seems inevitable and, notice how the crypto-friendly banks seem to be the ones going under. Why is that, you think? I certainly donât have a macro crystal ball but these are fascinating times. What I do know is that the âitâs for the little guyâ line is as old as time. And, at the end, someone has to pay. To your point, the FED should have acted in 08 by gradually restoring interest rates to their historical levels (although this started way before then). They chose the easy way instead, re-inflating a bubble of unimaginable proportions. We are here now, dealing with the fallout of decades of bad decisions. Monetary and fiscal.
Is the solution to bailout everyone? When does it stop? Student loans next? Real estate? When do we restore monetary and fiscal sanity? Take a look at the FEDâs balance sheet. Take a look at the dollar value since 73. Itâs all manageable. For now. Donât quote me on that. Powellâs words in his latest testimony.
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Crypto is bad, yes.
But is it? 
Funny how this isnât part Yellenâs messaging. And the FDIC and the Treasury clearly isnât circumscribed by the letter of the law regarding congressâ decision regarding the $250,000 guarantee cap.
I hope that FDIC insurance fund is deep.
âOn a call with reporters, a Treasury official emphasized that the federal intervention would not bring SVB or Signature back to life, as the enormously controversial bank bailouts during the 2008 financial crisis had done for banks that were close to failing. Their executives would not retain their jobs. These new safeguards were aimed at protecting people and businesses who had made a reasonable decision to put their money into an accredited and regulated bank â not investors who bought risky securities. my emphasis
Crucially, the Treasury official also emphasized, the money used to reimburse the depositors would come from a fund paid into by U.S. banks. Treasury Secretary Janet L. Yellen and Biden both released statements Sunday night underscoring that taxpayers will not pay to rescue depositors because the bank fund would cover any costs.
âWe are trying to help depositors of institutions. The banks, equity and bondholders are being wiped out,â the Treasury official said. âThe firms are not being bailed out. The depositors are being protected.â
But other economists â including some Biden allies, and even those who defended the move as necessary â still say the measures amount to a bailout. Even though the fund is paid into by U.S. banks, it is ultimately backstopped by the Treasury Department, potentially putting taxpayers on the hook if it runs out.
The Treasury official said the fund has more than $100 billion in it and is highly unlikely to dip below $0. Any losses to the fund would be repaid in full by charging more fees to banks, the Fed, Treasury and FDIC said in a statement. Additionally, Treasuryâs Exchange Stabilization Fund also will provide $25 billion to backstop the Fedâs loan program. The Fed does not anticipate that it will be necessary to draw on the funds, officials told reporters.â
So now itâs a risky investment to buy stock in regulated banks? Or investing in US Treasury bonds/securities is risky? Good to know.
And who ultimately pays for the FDIC fund? Bank depositors and borrowers through their fees among other sources.
I definitely hope they go after the CEO and any other insider who obviously profited - tossing that money into the pay off pot, but otherwise, count me in as one who was glad to hear the govât is trying to help because I prefer not to see the country go into a Depression as happened in the late 20s and 30s or even a larger Recession like 2008.
I honestly donât think pure capitalism (or socialism or any other ism) works well mainly because humans are humans. I think a mix works best.
No human can predict long term future. Who knew Covid was going to come? I like safety nets that still encourage investment. Without various investment (banks included), our financial system couldnât be what it is.
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It is not illegal to profit. It is illegal to use insider info, but this information may not be âinsiderâ if it was published in their annual reports or even monthly statements to the regulator.
Not very many bank execs went to jail in 2008.
Agreed on the first, but even if the CEO and any other insider get nothing or merely a slap on the hand, Iâll admit to always thinking theyâre trash ethically and morally (as it applies to stock and finances). Thereâs no way in that short of a period of time that they didnât know. It wouldnât even surprise me if they pumped and dumped, but that is just a thought on my end - havenât looked to see if thereâs any truth to it. Itâs just kinda common among insiders with stock, esp if the company is going to take a hit.