> It's impossible to move on. There was insufficient funds to pay depositors; meaning, the money was gone - Since the money didn't vanish into thin air; somebody got that money through some scheme.

There was no theft. The bank bought bonds that decreased in value rapidly due to rising interest rates. Pure mismanagement, but not theft.

The bonds are good to yield on the stated timeframe. You need to hold them to maturity. They bought long term bonds and tried to sell them after newer higher yielding bonds came out. Bad decision. Also lobbying to avoid stress testing below 250B instead of 50B.

They could have kept deposits as cash and watched the value erode like a dumb retail consumer has an option to do. But that’d look bad for bank investors.

So now the Fed and Treasury are responsible for negative yield on bad bets if that account crosses 100B. Cool. I only have about 100B to go before the US government cares about my negative position. 401K takes an L because interest rate rises and the SP500 being a stock buyback circus. That’s on me I guess.

Anyone saying well it’s not using taxpayer dollars. Whatever, it is using our feds time. This whole thing is now J Powell and Yellen focusing on a cottage industry serving billionaire interests instead of using their time and agency to work for that dumb aforementioned retail consumer undergoing inflation and a pending recession.

In an agency where any intervention sets a precedent this is now telling regional banks to go ahead and yolo your balance sheet. We got you.

I want the startups to get their money through liquidation of the bank at whatever discount that comes to. 80c on the dollar, whatever it isn’t your money anyway it’s VC money. All savings accounts come with 250k FDIC insured. So play by those rules.

SVB shareholders have been wiped out in this, and the prospect of that fate should motivate banks to try to avoid a similar outcome for their institutions going forward.

It depends. It's likely that some of those big SVB shareholders were also shareholders of ventures which had deposits at SVB so they got punished and bailed out at the same time... Less punishment. Maybe even profitable for them.

They did pass tax on buybacks

Carried interest needs to be next

The whole business of a Bank is to manage interests and money. If a bank didn't consider interest rate and duration risks, it is such a gross mismanagement that it looks identical to theft. That is like a chef saying yeah we had best knife and utensils, we just didn't clean them and some mould was growing on them. On top of that is the suspicious sales of stock by CxOs.

We cannot know it wasn't theft. Counter-parties were sitting on the other side of the trade benefiting from the loss of value of those bonds. They earned a bunch of money, bought themselves yachts, the yacht companies stock price went up, they gave raises to their execs, who bought themselves mansions, etc, etc... This drove up the cost of living for everyone else. Now it turns out that the bank is short on depositors' funds. Instead of depositors taking the loss as punishment for doing business with this bad bank, citizens who had absolutely nothing to do with that bank will foot the bill through inflation when the government issues new currency to make the depositors whole.

It's taking money from citizens who had nothing at all to do with SVB to people who were doing business with it and may in fact have benefited from it.

It’s not strictly speaking taxpayers, it’s anyone with a bank account at a U.S. bank. But same effect.