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A comment on Joint Statement by the Department of the Treasury, Federal Reserve, and FDIC. Parent comment

Re:Joint Statement by the Department of the Treasury, Federa... by Thorrez on Sunday March 12, 2023 @10:03PM (#35129820)
>it's based entirely on consumer confidence

Not typical consumers, right? Typical bank consumers have < $250k in their account, and thus there's no reason for them to cause a run.

[ Parent | on HN ]
Re:Joint Statement by the Department of the Treasury, Federa... by twblalock on Sunday March 12, 2023 @10:26PM (#35130088)
That didn't prevent multiple runs against Washington Mutual in 2008, and it won't prevent runs now. People are worried that they won't be able to get to their money even if it is insured.

Plus, even if the "typical" consumers don't freak out, businesses might. There are a lot of businesses with accounts over the FDIC limit. Only about 60% of bank deposits in the US are insured.

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Re:Joint Statement by the Department of the Treasury, Federa... by chrisdfrey on Sunday March 12, 2023 @10:36PM (#35130214)
Right, and the clientele of SVB was largely businesses. Only 7% of SVB deposits were FDIC insured, making them extra vulnerable to bank runs.
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Re:Joint Statement by the Department of the Treasury, Federa... by flangola7 on Sunday March 12, 2023 @11:39PM (#35130695)
>People are worried that they won't be able to get to their money even if it is insured.

If the US government is unable to cover those claims then you have much bigger problems to worry about.

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Re:Joint Statement by the Department of the Treasury, Federa... by notch898a on Monday March 13, 2023 @12:33AM (#35131115)
If I thought the US government was going to fail I'd simply try to be the first to convert my dollars to a dense and valuable commodity, like gold, and then find another government to live under. It's not like people pulling out dollars have to keep their wealth in dollars.
[ Parent | on HN ]
Re:Joint Statement by the Department of the Treasury, Federa... by antihipocrat on Monday March 13, 2023 @02:38AM (#35131937)
If it ever got that bad a can of beans would be worth more than almost anything.
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Re:Joint Statement by the Department of the Treasury, Federa... by ThalesX on Monday March 13, 2023 @06:31AM (#35133716)
Not the first failing empire in the history of the world...
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Re:Joint Statement by the Department of the Treasury, Federa... by heisenbit on Monday March 13, 2023 @03:10AM (#35132184)
The ability to mint money is unlimited. The ones being eventually bailed in will be foreign debt holders via inflation.
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Re:Joint Statement by the Department of the Treasury, Federa... by tbihl on Sunday March 12, 2023 @10:05PM (#35129842)
I guess maybe if all the small customers pull out of index funds to flee to bitcoin? Not sure.
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Re:Joint Statement by the Department of the Treasury, Federa... by gmane on Sunday March 12, 2023 @10:27PM (#35130098)
How would they even do that? Bitcoin handles ~350k transactions per day. VTI (Vanguard's Total Stock Index), a large size fund is on average traded 3,670k per day. That's one fund. There is no reasonable way for small customers to pull out of index funds to bitcoin unless there is a fundamental change to how bitcoin operates.
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Re:Joint Statement by the Department of the Treasury, Federa... by sowbug on Sunday March 12, 2023 @10:57PM (#35130389)
VTI (Vanguard's Total Stock Index), a large size fund is on average traded 3,670k per day.

I doubt those VTI transactions are each of a single share, which is the only way the 3.67M number you cite would match VTI's trading history.

But nobody's mind was ever changed about Bitcoin on an HN comment thread, so let's just leave it at that.

[ Parent | on HN ]
Re:Joint Statement by the Department of the Treasury, Federa... by landemva on Monday March 13, 2023 @12:06AM (#35130910)
Small customers get BTC from an exchange, which keeps their accounting internally. No transaction volume limits.

Later the small customer may move that BTC to self-custody, which could be an on-chain transaction or LN or other side chain with more transaction capacity.

[ Parent | on HN ]