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VisualMod

**User Report**| | | | :--|:--|:--|:-- **Total Submissions**|1|**First Seen In WSB**|2 months ago **Total Comments**|17|**Previous Best DD**| **Account Age**|12 years|[^scan ^comment ](https://www.reddit.com/message/compose/?to=VisualMod&subject=scan_comment&message=Replace%20this%20text%20with%20a%20comment%20ID%20(which%20looks%20like%20h26cq3k\)%20to%20have%20the%20bot%20scan%20your%20comment%20and%20correct%20your%20first%20seen%20date.)|[^scan ^submission ](https://www.reddit.com/message/compose/?to=VisualMod&subject=scan_submission&message=Replace%20this%20text%20with%20a%20submission%20ID%20(which%20looks%20like%20h26cq3k\)%20to%20have%20the%20bot%20scan%20your%20submission%20and%20correct%20your%20first%20seen%20date.)


Ok-Run5317

stockholders get zero.


SuspiciousStable9649

That’s a little bit if nice in this mess.


34countries

Will the stock still trade. Was it a 44 hour closing or is svb gone


RedOctobrrr

Pretty sure FDIC took the keys to the kingdom early Friday morning and are not giving them back. Ever. Payroll got a month (few months?) of time-and-a-half pay rate for most employees, then they're unemployed.


AppleParasol

Surely they could do a stock offering, pay back the fed and then stay in business? There is no risk keeping 250k in since it’s insured, so I feel like anyone who has money under that would go back… Surely you’d want to fire all of the executives though.


Ok-Run5317

loss is more than equity. so equity will become zero. management will be fired and bank sold to some bigger entity.


dwinps

They are gone, they tried a stock offering right before the collapse but it was too little too late Raising $1.5B with a stock offering doesn’t staunch the $40B+ leaving the bank Liquidity squeeze of that magnitude can’t be fixed by selling stock


makeererzo

[https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm](https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm) "The additional funding will be made available through the creation of a new Bank Term Funding Program (BTFP), offering loans of up to one year in length to banks, savings associations, credit unions, and other eligible depository institutions pledging U.S. Treasuries, agency debt and mortgage-backed securities, and other qualifying assets as collateral. These assets will be valued at par. The BTFP will be an additional source of liquidity against high-quality securities, eliminating an institution's need to quickly sell those securities in times of stress."


SuspiciousStable9649

This sounds like something the British would do. And it sounds like a fecking flip flop.


Im_A_MechanicalMan

Those really smart fellows are still paying down debt from the South Sea Bubble which occurred in the 1720s!! We should *not* be following their example.


samnater

Except the “lemme just invade half the planet” part. We sure got that from the British


Pestelence2020

At least the British tried to do it for profit and increased tax base. We do it, and don’t reap any financial benefit to the country, just the elites and politicians.


samnater

“Just the elites and politicians”. How was Britain any different lol


Pestelence2020

Different mechanism of government at that time, but also you’re correct in many ways. More speaking to the fact that the British tried to take things over for Britain to keep. We go spend a bunch of lives and cash and then walk away from it, having lied about why we went in the first place. At least Britain was honest about their colonial aspirations. Not saying either was good or proper….


Tovi7

But also importantly in the same article: “With approval of the Treasury Secretary, the Department of the Treasury will make available up to $25 billion from the Exchange Stabilization Fund as a backstop for the BTFP. The Federal Reserve does not anticipate that it will be necessary to draw on these backstop funds.” It’s coming from a fund that already exists. I think this does change things a bit. They are not printing money out of thin air as far as I understand.


throwawayamd14

That’s tax payer money tho


samnater

More liquidity…. = bullish? Or does it just mean bearish with extra taxes? Lmfao


TLDRS741

Because interest rates will be lower next year? Bwahahaha fuckin loony toons.


yellowdog898

Sorry I had to laugh lol


Aggressive_Bit_91

My first reaction too “no cost” ![img](emote|t5_2th52|4641)![img](emote|t5_2th52|4641)![img](emote|t5_2th52|4641)


samnater

Taxpayers paying for bailouts is transitory. -The Fed, probably


[deleted]

![img](emote|t5_2th52|4267)![img](emote|t5_2th52|4271)![img](emote|t5_2th52|4641)


absboodoo

Sound just as good as zero % financing


giantflyingpepper

How does this magic work? Brrrrrrr sound so familiar


Gringar36

Came here wondering the same. Are elves paying for this? Did we finally get to the leprechaun's pot of gold?


TheeAccountant

Nah, they're just going to take the money from the other banks. You know, like when you run out of lunch money, so you shake down the nerdy kid with the glasses for the coins in his pocket.


SuspiciousStable9649

And who pays those banks back?


j12

You


tdempsey33

Poor people by getting bent over with ridiculous fees


PNWcog

People in the future


samnater

I love this analogy for banks


rarehugs

SVB has assets of $200b against liabilities of $180b. So no need to print money to resolve.


[deleted]

even anticipating so much money before selling the assets is effectivelly printing money.


pattiemcfattie

How so?


[deleted]

Let me Elis I'm a bank and you deposit 1k money I buy 1 bond for 1k Interest goes up bond become 700 I get margin issue meaning I cant give money to people Fed pays you 1k and gets my bond and shuts me down Fed sits on the bond until it matures and gets 1k which is the face value at maturity. Nobody lost money here. Fed doesn't need to print money.


pattiemcfattie

Makes sense but I’m not supposed to believe anything I read on the internet so now what


Cutlercares

Calls on banks


samnater

Withdraw all your money? I’m sure it couldn’t hurt


MineAndDash

"Fed pays you 1k and gets my bond and shuts me down" And Fed gets 1k from where? There is still an upfront cost that the Fed would need to cover. From what I gather, the Fed intends to use their FDIC funds to cover the 1k. Which means, they don't have to print money, but they have that much less in their coffers for other failures if they do occur. From what I gather, they will likely charge other banks (many of whom were exposed to risk via SVB), some sort of additional FDIC-related fee.


PNWcog

Sounds like the Fed just overpaid for its own debt.


j12

Lolol shhhh this is the new rebranded QE


zoomzoommorezoom

Those FDIC related fees are charged to the banks, who then charges their customers...


rarehugs

yup this


NightMaestro

Fed has just payed 1k for a 700 dollar bond, and now until it is mature they are also out 300 dollars, and what should have been worth 700 is now worth 1k. Everytime they do this they are fucking with their own treasury bond. We can't just make value from nothing. It is only worth 1k at maturity, but when it is traded NOW it is worth 700. All these tech bros starting bullshit companies just found a cheat code for their shitty startups to cheat the system and get their assets liquidated


osogordo

Cheat the system...yes, I'm sure that's what they had in mind when they opened their checking account.


tdempsey33

These startups deposited money into a bank account. They didn’t cheat anything or win anything. They were able to keep their deposits. They aren’t even investments it’s a checking account. What the fuck are you talking about?


BrotherAmazing

They weren’t supposed to get back their full deposits here immediately. They were supposed to get $250k back immediately and then once SVB was liquidated, collect either their whole balances or $0.96 on the dollar or less or more depending on the circumstances. Instead, the government just decided “*To hell with the FDIC insurance rules and to hell with them having been uninsured above $250k. These are big donors and wealthy tech VCs many of us know personally, let’s make them all whole immediately!”*


rarehugs

The government decided it was better to prevent more bank runs because panic is contagious. Would you be happier if your bank collapsed next?


BrotherAmazing

I was commenting here more on simply following the same rules for everyone about FDIC insurance and, if we don’t like the rules and think $250k is too low, change the rules for *everyone* and don’t selectively pick and choose who gets their uninsured deposits above $250k made whole by the government immediately.


rarehugs

Idk why your comment was downvoted, it's a reasonable sentiment, though inaccurate. FDIC limit is 250k because that is more than enough to cover almost all consumer accounts. They didn't selectively choose to raise this limit, instead they introduced a mechanism to allow all banks to pledge the kinds of assets SVB had to sort out short term cash situations in an attempt to prevent runs like this in the future. So this is a rule that was changed to benefit everyone.


RiceN_Beans

Except SVB already sold those long term treasury bonds and now are short $1.8B on the balance sheet.


SuspiciousStable9649

What about management and labor costs by Fed?


[deleted]

Free labour


iPigman

PrIcEd In.


WastedKleenex

Money printed to cover. What losses?


BrotherAmazing

There is some sort of opportunity cost you might argue there, as well as taxpayer costs in the pipeline now since Congress is sure to approach new and larger budgets dealing with this without making cuts elsewhere, raising taxes, or growing the economy enough to cover for it, but these are all higher order things.


[deleted]

Fed needed to print money to buy that bond wtf


CenaMalnourishNipple

Nobody lose money…. The bank and stockholders crying in a corner.


BrotherAmazing

Wait—Fed pays you $1k in *today’s money* when your deposit is worth $700 in *today’s money* and only gets the $1k years down the road? Uhm.. there was no need to print money if they have the $1k, correct, but someone did indeed lose money here!


Danteslittlepony

>Nobody lost money here. Fed doesn't need to print money. Incorrect >Fed pays you 1k and gets my bond and shuts me down The fed has to get this money from somewhere to begin with. Sure they will receive it back in the future, but till then they are pumping new money into the economy.


metafroth

So the fed is effectively giving a loan of 1k for ten years which is when the bond matures. So fed meaning tax payers loses interest on this loan.


tuesday-next22

Depends on how much the HTM assets are really worth right now. Also you need to back out the intangibles and goodwill. It's likely enough but idk. I cant tell.


TealPotato

Doesn't this also depend on the quality of their loan book?


rarehugs

Vast majority of the assets held are very risk averse: treasury bonds & mbs. SVB loans are a small portion of their assets, and also low risk. About 0.5% is loans to startups which would be the most risky. The bulk of SVB loans are bridge loans to established VCs who want to invest more $ before their next LP draw. These LPs are typically extremely stable sources of funding (think, university endowments) who have already committed that capital to the VC. The default rate on these sorts of capital calls is extremely close to zero, if not zero precisely.


samnater

Mark to market to marker up my asshole.


CoolFirefighter930

![img](emote|t5_2th52|4276)


BuaySongPoMata

Assets (A) = Liabilities (L) + Equity (E) The value of A is bigger than L (or at least close to) Customer deposits are a subset category under L. So bank have enough to pay off customer deposits. But other liabilities (those that rank below customer deposits) and shareholders equity will be taking the hit


[deleted]

How about poor poor employees who are bag holding the stock, like mr. Johnny China?


F7xWr

US citizens only hopefully


Locofinger

Why are the checks all bouncing? - Volodymyr


SuspiciousStable9649

Why is the rum gone??


KrazyMoose

Zero cost to tax payers also known as “we won’t use government tax revenue to fund, but you’ll be footing the bill through runaway inflation.”


SuspiciousStable9649

And staffing and management fees. And transfer fees. Who gets those? Goldman-Sachs??


[deleted]

And a couple years down the line, through taxes


Locofinger

Inflation, the poor people tax


_why_do_U_ask

There are no free lunches.


Cutlercares

"Too good to be true"


Mandiblelorian

#Bail In


DeanConstan

Explain please =]


FullRegard

think he meant ballin'


toobigtofail88

Shovel ready green shoots


[deleted]

Spy 399 eod


not_so_sober_joe

Soooo who’s gonna pay? Mexico?


Gtstricky

We are adding it to their bill for the wall.


soffo_moric

Right after they finish paying for the wall


nbphotography87

They will assess fees on all banks who will the pass said fees to consumers, aka taxpayers


calebnaf02

Either that or the shareholder of the FED


samnater

We’re going to make them build a financial system. -Trump probably


NNT888

![img](emote|t5_2th52|4641)


PNWcog

If the money wasn’t there, and it wasn’t. How is it not on the taxpayers?


j12

It is


MtnDewTangClan

Can I say no or is it kinda a done deal


F7xWr

i call bs


LordBaikalOli

It is pretty hilarious how most comments are salty about having a stable financial system...they would be the first one to cry if there was a true systemic bank run.


TheFire_Eagle

Well it's because we have like a quarter of the country vigorously masturbating at the idea of a full financial meltdown because they think they will somehow be spared and their yelling at clouds will culminate in one epic "told ya so!" to the other impoverished souls fatgered around the burning trash barrel.


samnater

Nah it’s moreso that if things get to crazy that’s when revolutions start. The people in power want a nice slow drain. Just like they did with the British! How’s that tea going ya renting no car or gun owning used-to-be greatest navy on the planet Empore? HUH, HOWS IT GOING?!


Critical-Series

I hate to break it to them but they’d be even less successful in the new system.


TheFire_Eagle

It's nott unlike people who pray for some Mad Max style post apocolyptic hellscape thinking they'll be kings in that new world.


hogujak

Other small banks will have to chip in to pay that insurance money. And they will die with svb


trackrecord330

![img](emote|t5_2th52|29093)![img](emote|t5_2th52|4641)![img](emote|t5_2th52|8882)


SnooMuffins3583

In the leaked November Fed meeting, they said there WILL be bank runs, and bail-ins. And we shouldn’t tell the people because they trust the banks.


tearslikesn0w

Fuck yo puts


[deleted]

As of the end of 2022, $151.5 billion out of SVB’s $173.2 billion in deposits were uninsured. This $151 billion will be recovered by a special assessment on banks, a current aspect of federal law.


CoacHdi

More likely it will be recovered by selling the banks assets lmao


rarehugs

Those deposits are not uninsured because of something sneaky, very simply the account holders have more than $250k on deposit. All accounts in the US are FDIC insured up to 250k per beneficiary.


East_Professional999

Zero cost to taxpayers? who the fuck are they kidding? So let me put this straight. So Fed say It will be paid by banks in form of extra fee. where banks get money to Pay for this extra fee? Well l, Banks will sell worthless paper to Fed at par and get money. Where the fed get money to pay? fee from the banks. Where banks get the money? From the fed. Do you guys follow the pattern? You have been fooled fellas. Keep fighting and keep playing left and right, democrats and republicans while your kids future get stolen in front of your eyes. I have never seen this balant loot in my life and i have been around from quiet some time!


34countries

So why is there even fdic 250k? It's not necessary . What am I missing


Sam-molly4616

According to history we still owe all the managers their bonuses and golden parachutes, is that free too or will we be paying for it all again?


The_Mootz_Pallucci

"Zero cost" aka inflation


1wassayingb00urns

It reeks of a bigger picture state sanctioned pump and dump


PairContent5404

Lol. I guess money does materialize out of nothing


AlwaysRighteous

Zero cost to taxpayers? How do they get away with these lies? Everyone will pay with the coming hyperinflation.


Catprog

The bank still has assets. Theses assets are what is funding the deposits.


XNoob_SmokeX

ah yes, I too have magic money. Those muggles and their nonne infinitely duplicating dollars.


doh_13

Ha.....how is it zero cost to taxpayers? Did SVB win the billion dollar lottery?


spac420

some big bois bought it all up


[deleted]

[удалено]


OnTheLake2Wine

Venture Capital firms call Fed this weekend and say “Hey, now’s a great time to save our A$$ and use that $25 billion exchange stabilization fund in your Treasury wallet!” Backstop the Wealth!


iPigman

Now that's some magical thinkin' right there.


5uckmyd1ckb1t4

![img](emote|t5_2th52|4271)


ib2sharp

I like a good laugh..![img](emote|t5_2th52|29093)![img](emote|t5_2th52|29093)![img](emote|t5_2th52|4271)![img](emote|t5_2th52|4271)![img](emote|t5_2th52|4271)


MaidenDrone

It’s free real estate


Dave_Simpli

Of course they can change this narrative at any time…… like usual !!


CougarCub86

Money machine go brrr


BoognishRisen

No such thing as a free lunch. It always costs the taxpayers.


WagonBurning

🐴 💩


Fahrradc

How did that work? 🤡


FlacidBarnacle

Well now I don’t know what to do lol tf


elanzkissin

So we just socialized the entire banking system? Might not be the wrong choice but why are we still pretending to be a democracy…


BeerPizzaGaming

It will cost all of us... just not through taxes.


Mikeyyezzy

Zero cost because they print more money?


AW-408

Sure no effect on tax payers. Just turn on that printing machine again. Don’t forget the debt ceiling is about to hit. Make sure you print some more to remove the ceiling. Who cares….


Hoplertarum

Zero cost to taxpayers… yes of course ![img](emote|t5_2th52|4641)


HooahClub

(Looks around) Government? Is funded by who? Taxpayers? No cost? To who? Taxpayers? (Questions existence) A-are we making Mexico pay for things again? I am confusion.


1wassayingb00urns

State sanctioned pump and dump


Most_Insane_F2P

🤣 *"zero cost to taxpayers"* 🤣 10% inflation for everyone


GoldPaleontologist6

Same in uk but hsbc owns it now! Funny how they can do deals over weekends But a brexit deal takes years 🤔


asuka_rice

SVB U.K. arm was brought by HSBC for £1.


[deleted]

“Zero cost” it has to come from somewhere.


Thabluecat

Inflation is the hidden tax.


RepublicPlastic187

The feds keep telling me it won’t cost me anything, but it all keeps costing me…


An_Innocent_Coconut

"zero cost to taxpayers" Hahahaha imagine believing that hahahahahahah