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Re:Silicon Valley Bank unmasks the hypocrisy of libertarian ... by bcrl on Wednesday March 15, 2023 @10:25AM (#35168775)
So, the solution to bad assets is more debt? How are the banks going to cover that debt when their customers are fleeing and interest rates are rising? I fear this is only kicking the can down the road by a few months (or years) before even worse fallout occurs when the failed banks have to make substantially larger interest payments.

Edit: a better term might be Zombie Banks.

Re:Silicon Valley Bank unmasks the hypocrisy of libertarian ... by mnky9800n on Wednesday March 15, 2023 @10:31AM (#35168849)
Welcome to Japan circa 1990s which is now why Japan has the economy it does today.
Re:Silicon Valley Bank unmasks the hypocrisy of libertarian ... by gizmo on Wednesday March 15, 2023 @10:52AM (#35169219)
The idea is that when customers know a bank has effectively an unlimited line of credit to pay for outflows that there is no reason to panic. Conceptually, the credit line works perfectly even if it's never used.

I agree it's not a solution, but it's smart and effective stopgap measure.

Re:Silicon Valley Bank unmasks the hypocrisy of libertarian ... by HDThoreaun on Wednesday March 15, 2023 @11:32AM (#35169875)
Why would customers flee if there's no risk of the bank running out of money?
Re:Silicon Valley Bank unmasks the hypocrisy of libertarian ... by hmoodie on Wednesday March 15, 2023 @12:29PM (#35170780)
In a constant intereest rate environment the bonds' market value will tend towards par value the closer they get to maturity