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Rumors, happenings, and innovations in the technology sphere. If it's technological news, it probably belongs here.

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Seriously, what's up with big sites literally dying as we speak? (lemmy.ml)

submitted 2 years ago by [email protected] to c/[email protected]

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First all the bs with Twitter and Elon, then Reddit having an exodus to Lemmy (not complaining lol), then Twitch. Are we like, in an alternate self healing dimension or something?

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[–] [email protected] 9 points 2 years ago

I agree with most of what you said. I would say classifying SVB as a seizure is probably not accurate. The FDIC only came in when it was clear SVB was going to fold and in fact insured far more than the 250k per account guaranteed. Mainly to try and stem a run on midsize banks because

Many companies had large holdings, undiversified in these banks
The banks were borderline negligent with how they handled those deposits, sticking them all in “safe” government bonds that ruins liquidity.

Once the interest rate on the bonds was lower than the base borrowing rate, no one would buy the bonds instead of just buying new bonds with a much higher guaranteed return.

So, given that, I would say the FDIC instead bailed out the banks. Something they would never do for you or I, or even a business with similar valuation as any of the banks customers.