But, much of the profits they made, and losses they are now incurring are both a consequence of the zero interest rate environment and it's current unwinding.
If the goverment bails out YC's companies, when they are successful later, who is going to benefit the most from that?
There are thousands of businesses using SVB. If they only know they have 250k coming in the near future, and can’t be sure they’ll make payroll, what do you think happens to all of their employees? Or the other businesses relying on their products? Or anyone they owe?
This is the second largest bank failure in US history, and for now it’s confined to a single bank and the cost to stop the fallout is relatively low.
If decisive action is not taken by the end of this weekend, it’s going to get much, much worse.
But what you're saying is the same thing: that taxpayers (random third parties who weren't even working in their ecosystem) should take the hit instead.
Spending taxes on preventing financial meltdowns from cascading actually makes the government and its citizens wealthier than not doing so.
What was your cash management strategy with your startup (assuming you have relevant experience)?
Your suggestion is equivalent to saying that if I were to support hundreds of kickstarters for various board games and resell them for a profit to collectors over the years and then kickstarter imploded after taking on extreme financial risks, then I should bail out all the new customers of kickstarter who paid and didn’t get their games. It makes no sense. The people running kickstarter should take the hit, not someone random other party working in their ecosystem.
SVB owners should get wiped out, not the people or companies who opened bank accounts.