Current Events > U.S. gov't used $12.7 billion to bail out 10 wealthiest depositors at SVB

(+) Yeah! (+)

https://dailyhodl.com/2023/06/25/us-government-spent-12700000000-to-bail-out-10-wealthy-depositors-amid-banking-crisis-report/

The Federal Deposit Insurance Corporation (FDIC) has released an unredacted document that shows the government guaranteed the deposits of Silicon Valley Banks (SVB) ten largest customers following its high-profile collapse in March.

The FDIC mistakenly released the complete version of the document following a Freedom of Information Act request from Bloomberg.

The document reveals the names of the firms that were bailed out, along with their total deposits that immensely exceed the $250,000 FDIC protection limit per account.

List of depositors in article.

But I can't get $10k for student loan forgiveness

Seems fair

DarthAragorn posted...

But I can't get $10k for student loan forgiveness

Seems fair

Right? And they just want to prop things up in the shadows while telling everyone else they can find the money.

Seems like they can if they want to. They just dont want to

Not even a $35 fee

[LFAQs-redacted-quote]


stimmies for worthless fucks

[LFAQs-redacted-quote]

To keep good faith in US banks and prevent a potential bank run. This isn't the PPP loan, this is money businesses deposited into a bank.

I decried the decision to protect above the FDIC limit and pointed out that the vast majority of the accounts at SVB was above the FDIC limit and in the millions of dollars or more, and the (261) board proceeded to simp for millionaires and billionaires, simply b/c Biden was doing the bail out, so they felt the need to defend it. It was fucking surreal.
But even in my complaints about it, I didn't realize the scale of the reverse Robin Hood going on was THAT bad! This is absolutely fucking disgusting, and fuck the Biden admin for selling us all down the river to bail out the 0.01%.

this has always been their country, we only work in it.

Personal responsibility, pay your loans ya bums, etc

ToadallyAwesome posted...

Right? And they just want to prop things up in the shadows while telling everyone else they can find the money.

Seems like they can if they want to. They just dont want to

Thats because the banks and student loan companies making profit from student debt are lobbying this .

There is big money involved with keeping the system the way it is.

streamofthesky posted...

I decried the decision to protect above the FDIC limit and pointed out that the vast majority of the accounts at SVB was above the FDIC limit and in the millions of dollars or more, and the (261) board proceeded to simp for millionaires and billionaires, simply b/c Biden was doing the bail out, so they felt the need to defend it. It was fucking surreal.
But even in my complaints about it, I didn't realize the scale of the reverse Robin Hood going on was THAT bad! This is absolutely fucking disgusting, and fuck the Biden admin for selling us all down the river to bail out the 0.01%.

While I agree that the bailout is disgusting, you are blaming the wrong administration for the mess. The Trump administration relaxed the rules that allowed the SVB board to play poker with their members deposits. They could not have done it under the rules set by Obama. Why isn't the whole board in jail right now?

Curious to see if he responds back to that

Privatize the gains, socialize the losses

amcdc79 posted...

While I agree that the bailout is disgusting, you are blaming the wrong administration for the mess. The Trump administration relaxed the rules that allowed the SVB board to play poker with their members deposits. They could not have done it under the rules set by Obama. Why isn't the whole board in jail right now?

They played poker by investing in what are considered risk-free Treasuries and government-backed securities?

Protecting depositors is a bailout? This is not the same as bailing out investors.

FactsKeepHurtin posted...

They played poker by investing in what are considered risk-free Treasuries and government-backed securities?

yes.

Dat_Cracka_Jax posted...

Protecting depositors is a bailout? This is not the same as bailing out investors.

The FDIC limit and under is "protecting depositors".

They knew the fucking limits going in, the government was under no obligation to pay back literally hundreds of millions of dollars per account.
This "lose faith in the banking system" line is total fucking bull shit. "Oh my god, you mean the government won't cover amounts they explicitly said they wouldn't cover? I'll never use a bank again!"

Fractional Reserve banking is inherently unstable. It's a Wonderful Life tried to warn us.

It's a little misleading to say it's the federal government who bailed them out because it makes it sound like the federal government used taxpayer money. FDIC is funded by insurance premiums banks pay into. So it's more like the federal government makes functional banks bail out non-functional banks. You could however make an argument that those banks who paid into FDIC will pass more of the costs on to customers like you and I though.

Medussa posted...

this has always been their country, we only work in it.

True dat dawg.

And idiots wonder why people hate capitalism

Kuuko posted...

It's a little misleading to say it's the federal government who bailed them out because it makes it sound like the federal government used taxpayer money. FDIC is funded by insurance premiums banks pay into. So it's more like the federal government makes functional banks bail out non-functional banks.

It's OUR insurance money. They admitted that if banks kept failing, they'd have to play favorites and let the smaller ones fail while saving the TBTF ones (which again, shouldn't fucking exist). There's a limit to the FDIC insurance money. They plundered from the safety net the rest of us depositors rely upon to save these shit bags who have more wealth than any of us will ever even sniff at yet can't be bothered to diversify their accounts or buy their own supplemental insurance coverage.

You could however make an argument that those banks who paid into FDIC will pass more of the costs on to customers like you and I though.

Oh, they absolutely will.

Most payrolls are above 250k so it makes sense government made sure employees were able to be paid. Sure the article lists the amount in but if these are private companies you won't know if they are underwater with debt.

streamofthesky posted...

It's OUR insurance money. They admitted that if banks kept failing, they'd have to play favorites and let the smaller ones fail while saving the TBTF ones (which again, shouldn't fucking exist). There's a limit to the FDIC insurance money. They plundered from the safety net the rest of us depositors rely upon to save these shit bags who have more wealth than any of us will ever even sniff at yet can't be bothered to diversify their accounts or buy their own supplemental insurance coverage.

Oh, they absolutely will.

If you don't have 250,000 sitting with one institution then the safety net hasn't changed for you at all. If you do have 250,000 sitting with one institution then this whole event basically told you that they'll make exceptions to pay people out over 250,000 anyway. You don't need to worry about the "plundering". The entities who got fucked here the most because of the plundering were the TBTF banks who paid in to bail out banks with shitty accounting and are now going to be charged more to make up the difference in the fund. If your bank starts charging you more now to make up the amount they got fucked over on then you can be mad, but the entity and actions you should really be blaming and most mad at is the previous administration loosening banking regulations which allowed SVB to manage their finances so horrifically that all of this happened.

But students qe can't get shit.

What happened to no handouts?

Kuuko posted...

If you don't have 250,000 sitting with one institution then the safety net hasn't changed for you at all. If you do have 250,000 sitting with one institution then this whole event basically told you that they'll make exceptions to pay people out over 250,000 anyway. You don't need to worry about the "plundering". The entities who got fucked here the most because of the plundering were the TBTF banks who paid in to bail out banks with shitty accounting and are now going to be charged more to make up the difference in the fund. If your bank starts charging you more now to make up the amount they got fucked over on then you can be mad, but the entity and actions you should really be blaming and most mad at is the previous administration loosening banking regulations which allowed SVB to manage their finances so horrifically that all of this happened.

I blame Trump for causing this. Feel better now?
I blame Biden for bailing them out and for not throwing SVB execs in jail. Just like I blame GWB for the Great Recession and Obama for not throwing the Wall Street con artists in jail.
Democrats continuously prop up and enable this shit by not holding people accountable. Yes, Republicans are the root cause, but they're pretty blatantly the party of the rich. Dems are supposed to not be.

[LFAQs-redacted-quote]

Also this.

cjsdowg posted...

But students qe can't get shit.

Let's see: $20 billion to cover losses at two banks that failed, all of which will be recovered by charging banks fractionally more for their own insurance

Or: $327 billion that cannot be recovered from anywhere

Takes a real genius to figure out why one is easier to cover than the other.

By all means throw the SVB leadership in prison but yours is the worst form of shit take on the situation.

I'm sure the people who complain about student loans and people on benefits buying the occasional steak are going to have a fit with this.../s

Southernfatman posted...

I'm sure the people who complain about student loans and people on benefits buying the occasional steak are going to have a fit with this.../s

It turns out corporations are the ones who get to burn through the money the government gives them and then ask for infinitely more.

This isn't a taxpayer funded bailout. This is all the banks bailng out the customers of a failed bank to avoid things getting even worse.

streamofthesky posted...

I blame Trump for causing this. Feel better now?
I blame Biden for bailing them out and for not throwing SVB execs in jail. Just like I blame GWB for the Great Recession and Obama for not throwing the Wall Street con artists in jail.
Democrats continuously prop up and enable this shit by not holding people accountable. Yes, Republicans are the root cause, but they're pretty blatantly the party of the rich. Dems are supposed to not be.

Also this.

The people who'd be most affected if FDIC didn't bail them out (again, using big bank money not taxpayer money) would be regular people. SVB's big advertising point was being the bank for tech startups. I'm in tech so weirdly had multiple people in my friend group who would've suddenly lost their paycheck if SVB was allowed to just go totally insolvent and customers only got up to $250,000. I just wanted to be clear on that because you're making it sound like all the SVB customers are bajillionaire individuals, and not just regular payroll departments. And others might also be under the misunderstanding the federal government just flew some money over from Fort Knox to pay back the bajillionaires, rather than the reality which is that the federal government demanded banks in general pay for this bank's fuckups. All in all it's difficult to see how stopping at $250,000 would've been good for regular people in any way. If anything doing that would've benefitted the uber-rich more.

If you want to argue that SVB individuals should be more harshly punished then I don't know anyone will disagree with you. Unfortunately that might be hard since the Trump administration made what their accounting legal. Anyway I think that's a slightly orthogonal sentiment from the one the OP of this topic was trying to convey.