1. Some mighty people/companies will bail out all depositors as this would cause a chain effect damaging the whole USA innovation.
2. Still, the consequences will be grim as many startups will lose access to venture debt and need to do layoff quickly.
Yeah, I'm sure Elon Musk can just write a check to cover this... oh, wait.
Seriously, who do you think would have the capital to swoop in here and cover something north of $170B in shortfall? Especially right now given that money is pretty tight everywhere.
The challenge is $80Bln mortgage-backed securities, which they likely have to sell at a 20-30% markdown and cover that.
It's not a bail out in the sense of free money. It's a bail out in the sense of a short term loan, just like after the GFC.