2008 was one thing, this is another. I cannot imagine any systemic risk from this event.
Tech companies should hire competent CFO’s who are adept at more than just pitch decks for additional financing.
I also read this company was super woke & funded bunch of climate, social justice tech company’s..which means they’re get a bailout from the regime.
What happened to the capitalist mantra of "allow mismanaged companies to fail?" The bank bailout of 2008 was unnecessary. Unlike 1929, we had FDIC in place and the federal government could have stepped in to take over any failing financial institution and not just write a blank check to prop up mismanaged banks and financial institutions. Fed Chairman Ben Bernanke scared Congress into it. “If we don’t do this today we won’t have an economy on Monday,” is the line famously attributed to Bernanke. Congresses $700 billion to bail out the banks was the banking industry bailed out by its allies in government, Bernanke & Geithner,
“I cannot imagine any systemic risk from this event.”
I sure can. Massive layoffs and lots of companies not paying THEIR creditors now. This can ripple out of control quickly. Plus investors are spooked and now hammering all banks. Plus the unrealized losses at the largest banks have soared due to rising interest rates that probably won’t come down for a long while.
Inflation is out of control. So things like this needs to happen then we may be able to get inflation under control again. That will bring relief to middle class.
or that’s aren’t solely focused on being HOMOS. You should see the ‘bio’ of the risk manager from SVB. The entire description is about being gay
“I cannot imagine any systemic risk from this event.”
The economy of the country and the world are tied together at the hip.
Money is fungible.
What does that mean?
https://www.dictionary.com/browse/fungible
Let us run the scenario:
Company A had a few million in working capital in the failed bank. They may get it back some day after the bank’s assets are sold off in a lengthy and complex liquidation process.
Meanwhile Company A has to pay their payroll—now.
Company A has to pay their vendors—in the next few weeks.
Company A does not have enough cash to do it.
Company A declares bankruptcy.
So—no big deal—one company, one casualty.
But—remember that vendor that Company A couldn’t pay.
We will call the vendor Company B.
Company A owed Company B a lot of money.
Company B needs that money to pay its employees and its vendors....
etc etc etc....