Every story and comment from the Hacker News API, in a layout borrowed from 2001.
A comment on FDIC Takes over Silicon Valley Bank. Parent comment
Those are short term liabilities. The ability of depositors to withdraw their funds is part of the liability.
If the bank wanted to raise long term deposits it would have had to pay much higher interest rates.
Once they withdraw the bank can not raise additional funds because all other depositors have better interest rates in other banks.
No amount of time will cure this situation, the values of those bonds will not recover. This is not some temporary panic.
The only way for the situation to improve is if interest rates go down in the short term. Unless that happens, the bank remain insolvent.
There are no comments on this comment yet.
Those are short term liabilities. The ability of depositors to withdraw their funds is part of the liability.
If the bank wanted to raise long term deposits it would have had to pay much higher interest rates.
Once they withdraw the bank can not raise additional funds because all other depositors have better interest rates in other banks.
No amount of time will cure this situation, the values of those bonds will not recover. This is not some temporary panic.
The only way for the situation to improve is if interest rates go down in the short term. Unless that happens, the bank remain insolvent.