[rocqua]

Their bonds weren't losing money. They were losing value. Value that would inevitably recover as the bonds reached maturity.

There was an easy and plausible scenario here where everything was fine.

Heck, the core of the problem here is that they got too many deposits over the last few years.

[lazide]

Correct on value vs money! I was being sloppy.

What is that easy and plausible scenario?

The only one I can think of is if they suddenly started getting a lot more cash deposits than withdrawals, or we entered a deflationary spiral (unlikely).