Banks Failing: Is It 2008 Again?

[CountValentine]

This is simple ignorance. This is not a taxpayer liability but rather on those who pay for FDIC insurance which are the banks.

FDIC does not have the funds if something major happens.

[aygart]

Woha! Calm down, we're talking about a bank that had an extremely risky situation, all banks are safe the only thing is how to psychologically convince people that there is no risk, by bailing out this bank it just shows how desperate the feds are to cover this up

You ready for NY metro multi family to get wiped out entirely?

[aygart]

So will they bail out all bank depositors should they fall? what's the threshold?

Why should there be a limit? What is the purpose of that?

[aygart]

Any issues depositing signature checks today?

No.

[aygart]

FDIC does not have the funds if something major happens.

It gets assessed to the remaining banks.

[yuneeq]

FDIC does not have the funds if something major happens.

They will have if needed. Right now the biggest fear is fear itself, ie. bank runs. Having the federal government standing behind deposits mitigates the need to deplete  their existing fund.

[Essen est zich]

Any issues depositing signature checks today?

I got a hold notice until Wed March 22 when depositing via BoA app.

[aygart]

Anything not true about that?

It is, and it seems some are hesitant about the truth.
Say what you want, the bottom line reason this happened is because interests rates had to be raised due to inflation

We can talk about it. There is a whole board for it here https://forums.dansdeals.com/index.php?board=30.0

I even brought it up there.

Anyone for our signature silicone toast?

[zh cohen]

Why should there be a limit? What is the purpose of that?

Because without a limit banks have less incentive to avoid risks. They get all of the upside and none (or little) of the risk.

I wonder if having two years of FDIC insurance would work.

The first their would have limited coverage. The second tier can cover all deposits, but will come with stricter liquidity rules.

Then it would be up to depositors to chose to use a bank that has tier one, which will be able to offer better rates and less fees, or tier two which would be more limited in their ability to make money from investments, and therefore would offer less to customers.

[CountValentine]

They will have if needed. Right now the biggest fear is fear itself, ie. bank runs. Having the federal government standing behind deposits mitigates the need to deplete  their existing fund.

The reason they need the government to back it is because they can't cover it. I am not saying this is a bad thing.

[ExGingi]

https://www.bloomberg.com/news/articles/2023-03-13/hsbc-to-buy-silicon-valley-bank-s-uk-arm-for-1-in-tech-repreive

The London-listed lender’s “ring-fenced subsidiary, HSBC UK Bank plc, is acquiring Silicon Valley Bank UK Limited (SVB UK) for £1,” HSBC said in a statement Monday. The deal completes immediately and will be funded from existing resources.

I am surprised they didn't need to get some syndicate together to come up with £1 for the purchase.

What a shame, I'm sure DDF could have come together to outbid them.

[aygart]

Because without a limit banks have less incentive to avoid risks. They get all of the upside and none (or little) of the risk.

I wonder if having two years of FDIC insurance would work.

The first their would have limited coverage. The second tier can cover all deposits, but will come with stricter liquidity rules.

Then it would be up to depositors to chose to use a bank that has tier one, which will be able to offer better rates and less fees, or tier two which would be more limited in their ability to make money from investments, and therefore would offer less to customers.

The incentive to bank execs is not depositor funds but their own equity which is getting wiped out as it should.

[aygart]

https://www.bloomberg.com/news/articles/2023-03-13/hsbc-to-buy-silicon-valley-bank-s-uk-arm-for-1-in-tech-repreive

I am surprised they didn't need to get some syndicate together to come up with £1 for the purchase.

What a shame, I'm sure DDF could have come together to outbid them.

Do they assume debt?

[ExGingi]

Do they assume debt?

I assume that they assume all assets and liabilities. In case it wasn't obvious enough, my post was 100% sarcastic.

[aygart]

I assume that they assume all assets and liabilities.

Then the cost can be much higher than 1

[savvydigz]

if you have time you can read this, the gov knew and continue to know the risks, let's see what they'll do
https://home.treasury.gov/system/files/261/FSOC2022AnnualReport.pdf

[aygart]

https://fortune.com/2023/03/12/silicon-valley-bank-failure-there-will-be-more-says-former-fdic-chair-william-isaac/

[CountValentine]

https://fortune.com/2023/03/12/silicon-valley-bank-failure-there-will-be-more-says-former-fdic-chair-william-isaac/

This guy has a crystal ball. 

“There’s no doubt in my mind: There’s going to be more. How many more? I don’t know. How big? I don’t know. Seems to me to be a lot like the 1980s.”

[yelped]

if you have time you can read this, the gov knew and continue to know the risks, let's see what they'll do
https://home.treasury.gov/system/files/261/FSOC2022AnnualReport.pdf

Ok, everyone is out to get you. Happy?

[Mimo]

You ready for NY metro multi family to get wiped out entirely?

They're over inflated, we definitely need a market correction