Re:SVB lobbied the government to relax some Dodd-Frank provi...
by tlamponi on Sunday March 12, 2023 @05:10AM
(#35118184)
> So essentially what you're saying is people should open a new account for every $250k they have
OP mentioned that there might be a service for that, and potentially also insurance that you can take out yourself for higher amounts.
> Insane that this is something that people now need to worry about.
Always has been, that is if you were just somewhat risk averse - more than one (unrelated!) bank account has always made sense.
FWIW, here in the EU we're only covered until 100k €, so 2.5 times as many banks required to spread safely ;-P
But, a lot of people do not need to have the cash around all the time, so one can but a big amount into relatively safe securities like S&P500 or for lower risk, which might be preferred here, gov bonds, and keep only the cash on hand for a few months of your expenses, which means most of the time two banks are enough, and having an account on two unrelated banks makes sense anyway - as if one has a bank run or fails completely you have still access to the cash on the other, for short-term things.
For companies this can work too, but they need a constant revenue stream matching their normal monthly expenses (e.g., salaries, office rents, ...) for it to work best.
OP mentioned that there might be a service for that, and potentially also insurance that you can take out yourself for higher amounts.
> Insane that this is something that people now need to worry about.
Always has been, that is if you were just somewhat risk averse - more than one (unrelated!) bank account has always made sense.
FWIW, here in the EU we're only covered until 100k €, so 2.5 times as many banks required to spread safely ;-P
But, a lot of people do not need to have the cash around all the time, so one can but a big amount into relatively safe securities like S&P500 or for lower risk, which might be preferred here, gov bonds, and keep only the cash on hand for a few months of your expenses, which means most of the time two banks are enough, and having an account on two unrelated banks makes sense anyway - as if one has a bank run or fails completely you have still access to the cash on the other, for short-term things.
For companies this can work too, but they need a constant revenue stream matching their normal monthly expenses (e.g., salaries, office rents, ...) for it to work best.