I may get downvoted, I may not. But, I am really surprised so many of you all are all about putting likely hundreds of thousands of people out of work. It goes so much further than the "billionaires".
Startups are risky. The money invested should be considered a risk. For all the people who would lose their job from this collapse, it's just as sad as the mass layoffs in the tech sector over the last few months. None of the employees of these companies have lost their personal wealth unless they also banked >250k there. The only big losers are the investors putting money into this already risky sector. It's not a sector that needs government backed bailouts. If you want to support the uber rich in these scenarios, just raise the backed insurance to 100% and let the government backed risk to be absolute. This shell game of "were not covering rich people but will will if anything bad happens" is simply disingenuous.
Startups are risky enough as is without having to create and manage 50 different banks with 250k in each. Those mass layoffs were the result of poor decisions and execution by the companies, and they should face the consequences.
We want startups to focus on innovation, and where they store (not invest) their cash should ideally be trivial
Hundreds of thousands of people out of work are threats to curry favor. VC's and businesses who deposited $175B into SVB have likely taken 5 - 20% losses on that. There are offers for 80% of deposits immediately and bridge loans to pay payroll for the foreseeable future until a couple months down the line when whatever left of the deposits is distributed back.
Do you advocate for immediately cutting Federal Funds interest rate? Because if not, every quarter point increase will cause thousands of people out of work. Every interest rate increase slashes the value of current assets, leading to try to "cut fat" to recoup value, just like what happened here, and because it's a bank, the wealthy see the opportunity to earn back their $10b - $20b loss by threatening the Federal Government.