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0 pointsloeg3y ago0 comments

Yeah, although SVB's failure demonstrates a major shortcoming with deposit insurance (in its role as a deterrent for bank runs). If you have more than $250k in assets, or are worried about short-term liquidity, you're still incentivized to run from the bank.

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capableweb3y ago

Correct me if I'm wrong, but FDIC insurance is mainly to protect individuals / small businesses from lose their entire livelihood, they're unlikely to have more than $250k in their bank account at any given time. If you do, you're most likely in/above the 1% and will survive by other means if you lose everything above $250k (or, rightly be "punished" for not having any other survival mechanism)

loegOP3y ago

Part of the reason to protect retail customers is to reduce runs on banks.

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capableweb3y ago

loegOP3y ago

Part of the reason to protect retail customers is to reduce runs on banks.

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