Exactly. Your point that the $250K limit on FDIC insurance per bank account backs up my point that it's not truly a savings bank if the bank is invested in nothing but 3 fairly risky asset classes: techs, startups, and U.S. treasuries (especially if treasuries are what the bank was considering their "safe" asset class). For Ford to not have to put their $440M in cash reserves (using your numbers as 88,000 ÷ 50 X $250,000) in 1,760 banks (to insure each account at $250K each), they have to choose one or a few banks that are truly savings banks with some risky investments for growth, but not completely in risky investments.
If I understood it correctly, most of the big customers at Silicone Valley Bank knew the bank was invested heavily in risky assets. They banked there as a way of helping themselves.
Your point would make more sense if SVB’s failure was tied to its risky lending. That’s not what happened. They simply couldn’t raise enough cash to meet the demands of large-scale withdrawals by its customers.
“it’s not truly a savings bank if the bank is invested in nothing but 3 fairly risky asset classes: techs, startups, and U.S. treasuries”
US Treasuries are considered the world’s safest asset. Even countries hostile to us own them.
SVB’s problem was owning too many long term bonds and not being prepared for interest rate hikes that would diminish their present value if they were forced to mark them to market.