[fbdab103]

SVB was offering higher returns by taking on more risk than was required. Those customers now lost nothing. The rest of us who went with safer banks offering market rate returns not only received less over that duration, but we have to pickup their tab.

Why should I or a bank ever do diligence again? I can just claim I misjudged the risk.

[323]

There are ways, fine the bank owners, claw back the bonuses, etc... Maybe even criminal law.

But the depositor has no fault. A depositor shouldn't have to do diligence, just like it shouldn't test the the food it's buying for toxicity.

[geodel]

> just like it shouldn't test the the food it's buying for toxicity.

Well I may have to if I buy food from a "innovator", "disruptor", "visionary" store that sells steaks at $2/lb and chicken at 99c/lb

[yibg]

What risks were taken by SVB? From what I understood, all the investments were in very safe ones.

[chitowneats]

They were supposedly safe. Misconceptions exist everywhere in business and finance. Silicon Valley's entire modus operandi is about "disrupting" industries that feel their business models are safe.

They were in fact not safe. The bank no longer exists after failing to cough up depositors' cash.