I'll be honest...before this happened, I didn't even know there were banks that weren't FDIC insured.
All commercial banks are FDIC insured, but only up to $250K per account. To steal Lyn Alden's quote...
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Silicon Valley Bank had 1) a ton of recent new deposits from one concentrated industry, 2) an unusually high number of large depositors (business-sized accounts) that were not covered by FDIC, and 3) an unusually high ratio of securities with unrealized losses relative to its total capital. Therefore, due to weak risk management practices, it was uniquely vulnerable to this type of depositor rug-pull that made them sell securities at a big loss. A number of other banks, especially ones focused on serving large depositors above the FDIC limit (and thus highly exposed to a bank run), have found themselves in a similar position, so there has been a localized contagion among banks that have similar asset and deposit profiles to Silicon Valley Bank.
^ I heard the bonuses were scheduled for that day. It wasn't a last minute decision.
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The Santa Clara, California-based bank has historically paid employee bonuses on the second Friday of March, said the people, who declined to be identified speaking about the awards. The payments were for work done in 2022 and had been in process days before the bank’s collapse, the sources said.
I think it's nothing shady going on as far as the bonuses.
Friday Mar 10 happened to be the 2nd Friday of March. Such a coincidence, but it lines up with what they've done in the past (if what they're saying is true).
Yep.
There's absolutely ZERO rationale for the employees to not receive the bonuses that were due to them. Granted the timing made the optics look poorly but that's irrelevant. Just feels like another "a-ha! Gotcha" moment from the peanut gallery.
Plus the owners and board (including Peter Thiel) started dumping their stocks the day before this all happened. Rich tech bros doing shady stuff to get even richer.
And the deregulation started with the roll back Dodd-Frank (mostly R-supported along a with a few D's) and other deregulation when Trump was in power is what eventually led to this.
Joined: 23 Jul 2004 Posts: 12880 Location: Los Angeles
Posted: Tue Mar 14, 2023 9:45 am Post subject:
Them R's always say we don't need no stinkin regulations...and then the inevitable happens which reminds us of why we had those stinkin regulations in the first place. _________________ So glad we gave you your flowers while you were here, Kobe.
Them R's always say we don't need no stinkin regulations...and then the inevitable happens which reminds us of why we had those stinkin regulations in the first place.
At some point, both the government and the public need to recognize that Peter Thiel is deliberately trying to sabotage the American economy as a major front in his push to destroy democracy and replace it with plutocratic autocracy.
Tech mogul and Republican campaign donor Peter Thiel is being accused of sparking the run on the bank that forced regulators to close down Silicon Valley Bank.
Journalists and critics have turned their focus on Thiel in the wake of SVB's collapse, accusing him of influencing businesses to withdraw their funding from the bank. His efforts are thought to be the first that eventually sparked the bank run, leading to California regulators intervening.
"To be clear, SVB did not properly hedge its risks against two threats, 1) concentration of influence by Peter Thiel, 2) rising interest rates," tweeted investigative journalist Dave Troy. "That was mismanagement, but it still wasn't fraud, and they still have sufficient assets to meet nearly all of the bank's obligations."
"There should be more scrutiny of Peter Thiel and Bill Ackman for yelling fire in a crowded theater in this SVB collapse," tweeted CNBC host Sara Eisen.
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Others turned their focus to Thiel's promotion and subsequent profiting off of crypto investments after the market crashed as a reason to be suspicious of his withdrawals. "You mean the guy who was touting crypto and trashing critics while he was selling crypto? That guy? Shocker!" tweeted tech journalist Kara Swisher.
(Peter Thiel’s role in SVB collapse under scrutiny)
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Bloomberg Businessweek’s Max Chafkin tells “Nightcap’s” Jon Sarlin that the run on Silicon Valley Bank suggests venture capitalists are not as smart as they think they are. Plus, crypto podcaster Jacob Silverman discusses why the collapse of two crypto banks is a big deal for the industry. And SocialProof Security’s Rachel Tobac explains why legacy password rules, like frequent changes and special characters, might not keep you from getting hacked.
Since the collapse of Silicon Valley Bank, American regulators have pulled out all the stops to protect depositors. But the scramble to ensure stability has exposed serious flaws in America’s banking architecture. What comes next?
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