Re:FDIC Takes over Silicon Valley Bank
by tome on Friday March 10, 2023 @12:49PM
(#35098116)
Why would someone keep more than $250K in bank deposits? Isn't it more prudent (looking back no more than 15 years) to keep T-Bills or some other liquid security that isn't subject to a bank run?
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$250k isn't much for a company with employees
you have to keep some cash somewhere to meet short term expenses (like payroll)
Is it not possible to meet short term expenses with a short term loan which is discharged over a few days by selling liquid assets? Maybe banks just don't want to let you do that.
Re:FDIC Takes over Silicon Valley Bank
by SpicyLemonZest on Friday March 10, 2023 @01:03PM
(#35098325)
It is, and no prudent company should have lost their entire war chest unless their funding arrived just yesterday. But when you're spending $10M or $100M a year, it's operationally challenging to make sure you never have more than $250K in the bank while you're doing it. (It's much, much better to be imprudent and have too much in bank deposits than miss payroll because you have too little.)