[qqqwerty]

The days of keeping you money under your mattress are long gone. The vast majority of modern day economic activity takes place electronically, and as such requires partnering with a number of different financial organizations to make that happen.

The government created this mess by lowering the regulations on community banks[1]. They should be the ones to clean it up. There are literally zero reasons why we can't have fully insured deposits. Even better, there are literally zero reasons why we can't have zero risk deposit accounts (hello fed), but they choose not to give it to us so that the bankers can make a profit on our money.

Small and medium size businesses are the life blood of our economy. And modern economies work on trust and specialization. You shouldn't need an advanced degree in financial engineering just to run a small cat sweater shop on etsy.

[1] https://www.cnbc.com/2018/05/24/trump-signs-bank-bill-rollin...

[bigiain]

> The government created this mess by lowering the regulations on community banks[1]. They should be the ones to clean it up.

When the bank that just failed was one of the groups lobbying for that lowering of regulations, I’m kinda all for the government telling them “You got what you asked for.”

https://www.theguardian.com/business/2023/mar/11/silicon-val...

I feel a lot of sympathy for customers of SVB who’re wondering how the fuck they’re gonna make payroll next week, or even if they’re going to survive this at all. But I have zero sympathy for SVB and it’s leaders - I’d like to see them be required to pay out every account holder in full from whatever “protected” wealth or assets they have. If any single customer is not fully made right, and the company leaders and directors are not all destitute homeless, they should go to jail.

[darkerside]

SVB did a poor job managing risk with its overweight long term bond investments. That doesn't seem to merit personal property seizure and jail time to me, especially considering how much innovation they've helped create in the past few decades. But maybe I've just gone soft.

[muzz]

I doubt any company will miss payroll this week

FDIC Races to Return Some Uninsured SVB Deposits Monday https://www.bloomberg.com/news/articles/2023-03-11/fdic-race...

[xedrac]

Many companies missed payroll this week. But they'll likely all make up for it next week.

[bagels]

Many companies tried to do payroll on Friday though?

[muzz]

How many?

[chernevik]

Zero risk accounts already exist in the form of T-bill money market funds.

There are many reasons why we should not have zero risk bank deposit accounts.

[spywaregorilla]

> The vast majority of modern day economic activity takes place electronically, and as such requires partnering with a number of different financial organizations to make that happen.

Ideally though that number isn't 1. All they're saying is they should have multiple banks.

[qqqwerty]

How many FDIC insured bank accounts would the cat sweater business need to protect them from Etsy withholding their money? I am pretty sure more bank accounts isn't really going to help with that.

[spywaregorilla]

Obviously the problem is not that the cat sweater business needed more bank accounts. It's that Etsy needed more bank accounts. Etsy is the one that cannot get its own money.

The cat sweater business probably wasn't banking with SVB to begin with.

[not_a_shill]

And now the cat sweater people know they have to diversify where they sell their product. I've seen people sell the same stuff on multiple storefronts. (easy, Amazon, ebay) This wasn't even the #1 reason to do that anyways, so they should have already been doing so.

Sucks for them, but it's a life lesson in starting a business.

[bagels]

Right, the implication is that they shouldn't have started their business at all because there was a risk that Etsy would use a bank that might fail.

[ashwagary]

>the implication is that they shouldn't have started their business at all

Instead of passing the buck, the takeaway is that Etsy could be punished for inappropriately managing customer funds held on behalf of sellers. I expect US law has avenues for sellers to seek adequate compensation for damages Etsy has caused, especially if the TOS didnt cover this outcome.