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Comment by chungleong | Hacker News Reader

Blaming one man for the rottened culture of an entire industry. The people who made the decision to withdraw money from SVB are supposed to be sophisticated. They're certainly well compensated. Yet they acted like bunch of illiterate peasants. The whole episode really demonstrated the disappearance of critical thinking from the American tech industry. This primitive monkey-see monkey-do mindset has come to dominate just about every aspect of it.

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if it was your money at SVB on the line - with two or three commas - you would think differently.

Or to put it differently - if you were the person to manage money with couple commas, you would have done the same.

It is classic prisoner's dilemma. The more there are participants - the less likelihood that everyone will act in a coordinated manner for common benefit. Two persons maybe can call each other and agree, but hundreds/thousands? unlikely

A prisoner's dilemma where prisoners are allowed to talk to each other isn't much of a prisoner's dilemma.

it is still prisoner's dilemma, because the fact that you talk is not binding. Anyone can agree on the phone and pull money immediately after call "just to be safe"

talking - means you can lock out everyone in one room and let them collude. This is not the case here, because the list of depositors at SVB is not public and it takes only a few people to start chain reaction of withdrawals

>Or to put it differently - if you were the person to manage money with couple commas, you would have done the same.

No I would have immediately had a private candid conversation with someone at the FDIC who would understand.

All good, but there's no denying that SV is a meme machine.

> Yet they acted like bunch of illiterate peasants.

Anyone who withdrew their money was acting rationally.

There is 0 upside to leaving your money in a bank that is at risk of experiencing a bank run.

Aren't most banks at risk of experiencing a bank run?

In what sense did they act like illiterate peasants? Trying to withdraw funds was the only rational act, as soon as the run started. What possible upside do you have for leaving all your money at risk?

They created the run, forced the fed to step in, and the result is they're all keeping their money. If it's stupid and it works, it's not stupid.

I mean, Peter Thiel has undeniably shaped startup culture for the last two decades, in particular 2008-2014 or so.

Isn't that kinda like blaming the crowd when someone yells "fire!" in a crowded theater? I don't know how much influence Thiel had in this particular failure, but I don't think it's appropriate to completely absolve those that triggered the start of the bank run from blame.

Especially since in the case the theatre was on fire, at least a little bit.

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