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Comment by baq | Hacker News Reader

Pathetic to be honest.

Yes it’s bad. Yes it’ll get worse if no buyer at 100 cents to the dollar is found by Monday morning. And yet, literally everyone involved signed up for it! It isn’t like there aren’t other banks? The thing had a circus for its risk management office. The big mighty all-knowing VC firms shouldn’t go around crying like babies and signing petitions but be organizing bridge loans until FDIC, the most brutally efficient government organization known to man fixes this, which will be soon and for most, soon enough.

Please don’t make VCs look worse than they are and socialize their losses. You’re in the risk business, do your job.

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It'll get worse if they're bailed out! It would totally change the perception of risk if they'll be saved every time they shit the bed.

Oh no people might continue putting money in bank deposit accounts at banks regulators have said are solid, we definitely don't want people doing things so totally unnecessary and crazy.

what are the implications of a bank that cannot fail no matter how reckless it is with everyones money?

The bank is already shut down, dead, gone, past tense. It's shareholders are wiped out, as they should be. Nobody is calling to save a bank that doesn't exist anymore. We're talking about the depositors. I think this has been confusing to a lot of people.

you're calling for the state to insure 100% of all deposits?

Only when the depositors have lobbyists on their payroll ;)

The worst part about this is if SVB does get bailed out by the government, everyone will wire their money out anyway. YC is not going to leave their money if it's back stopped again.

So the message is: "Please shore up and reopen SVB, so we can get our funds out. Then you can shut it back down."

We were told the capitalist elites deserve their outsized payouts because of all the risk they took and how that was the most meritocratic thing and how dare Government think to interfere with the beauty of the free market.

Now the risk has shown its downside, Big Government is asked to bail them out?

All I know is: I'd love to go to this casino. Win? It's mine. Lose? The house covers me.

These are businesses that had a reasonable expectation for their deposits to be there, and we are not advocating for a bailout of SVB's management or equity holders.

Sir you should talk rather firmly to your VC friends who told their portfolio companies to withdraw to maybe not spread FUD next time because things happen. It sucks this time around. Get those founders bridge loans instead of replying to a rando on the internet (though I appreciate the opportunity to interact).

If you want to understand why SVB failed, feel free to read writeups in proper financial publications, like FT or Bloomberg, and please avoid "mainstream" sites by clueless journos with zero finance knowledge. This one is good: https://www.ft.com/content/0387e331-61b4-4848-9e50-04775b4c3...

SVB didn't fail because of "FUD", but because of a dumb decision to invest at the top. SVB is squarely at fault here.

There can be more than one link in a causal chain. The broad problem was bank executive choices. But the urgent problem was a bank run caused in part by VCs telling everybody to take their money out.

Unpaywalled: https://archive.is/xMscB

I'd like to see a post-mortem or some sort of regulatory investigation to understand how it all went wrong. SVB had a risk management department, so what compelled SVB to make the decision that sealed its fate?

> These are businesses that had a reasonable expectation for their deposits to be there

These are businesses who willing took a chance that their deposits might not be there.

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