Jail seems extreme for an error in judgement that neither killed nor maimed anyone.
I'd, for a change, like to see those responsible for massive business failures held to account personally and financially. The limitations on corporate liability are meant for investors, not executives or board members. And TBH, those accounts with over 100MM in deposit should probably lose the 10% or so under normal rules for this kind of thing, not be bailed out by the Fed, who will in turn likely need to be bailed out by taxpayers, or worse if this happens another couple times in the next couple years.
If I drive recklessly, I am still guilty of reckless driving even though I didn't hit anyone or anything.
In a capitalistic system, money is power, and messing with it has serious consequences.
I'd rather be punched in the face than have all my savings drained, for example (as long as it's not Mike Tyson doing the punching).
Especially in a business such as finance where the job literally is to estimate risk, someone will make the (in hindsight) wrong decision.
No one is interested in the deal "if you get it right, you make some money; if you get it wrong, we obliterate you".
The move from caveat emptor to caveat venditor has coincided with everyone legally ringfencing things with corps & LLCs. People find ways back to a fair deal.
https://en.wikipedia.org/wiki/Incarceration_in_the_United_St...
or like being in possession of a gram of meth for personal use: something a person might legitimately believe isn’t “wrong”. the meth user didn’t get into jail for violating his own moral code: he’s there for an error in judgement, this error being that he didn’t understand how strongly the people around him would react to actions he thought were not that big of a deal.
sibling comment does good by calling attention to driving: enough people text while drive that it can be considered normal behavior, that people who do this don’t actively think they’re doing wrong. but that doesn’t save them from culpability when they roll the dice poorly and hit a pedestrian.
what’s the difference between “manslaughter” and “murder”: it’s intent. our justice system does consider intent, but it doesn’t require it.
Seems the difference is small. Shareholders still lost everything, depositors lost nothing instead of 10% but that's a minor difference.
Guess one difference is how long it'll take before depositors can access their money. Now they'll get it immediately. If they were waiting for liquidation of the banks assets, that would probably take longer.
SVB is down ~10% but that doesn't mean everyone would have actually been made whole from the money.
For the record, "1 year treasury bonds" are 52 week Treasury Bills. They would not be buying off the run old debt.
Anyone working in risk management will tell you SVB’s risk team and executive team should be in jail.
Don’t blame SVB’s failure on a bank run. SVB caused their own failure with their own risk management policies and it’s insolvency was probably inevitable for months.