[ConservativeInPA]

They’re not insolvent.Bull chit. They are unable to meet their current and most important obligations…their depositors. They do not have the cash and liquid assets. That’s piss poor management. Don’t twist it any other way. You sound like a pussy ass leftist that changes the meaning of words to not take responsibility.

[grey_whiskers]

Cool your jets.
Insolvent means “broke” in layman’s terms.
Illiquid means, they have it but can’t get to it.

If you treated all their govt. bonds at face value, they have the money.
But if you force them to sell the bonds *right now*, the sudden rise to higher interest rates, mean that if they “liquidate” them, they can’t get full face value right now: who would pay the same price for a bond paying 1.99%, as for a brand new bond paying 4% ?

It wouldn’t have been a problem except too many people showed up wanting to pull all their deposits at the same time.

And ironically, that started because the back became aware of the issue and tried to sell off a *few* bonds quietly, and push a stock offering, to raise cash until new interest rates calmed down / some of their low-price bonds matured...only people saw that, and panicked.

They started the stampede they were trying to avoid.

But two other issues;
1) they weren’t hosting Mom&Pop accounts, but small businesses, who NEED very liquid accounts so they can cut paychecks every two weeks
2) They way overinvested in “safe” govt. securities; and never stopped to think what would happen to their portfolio if the Fed suddenly goosed interest rates.

[Toddsterpatriot]

They are unable to meet their current and most important obligations…their depositors.

Which banks are able to meet all their obligations in a few days?