[dsomers]

> Maybe, but the latest Fed action violates a 40-year downtrend in interest rates, so it was exceptionally improbable from a historical perspective.

imo this is very flawed thinking, a once in a 40 year event is almost 100% likely to happen in an average persons life — maybe twice. I think when it comes to either your life savings or gigantic amounts of money like banks manage it’s irresponsible to not consider economic cycles that even only happen once per 100 years because of how likely it is to happen once is your life and be absolutely devastating.

I stand by my statement, this is 100% on SVBs amateur hour monkey level thinking.

[unyttigfjelltol]

I'm not disagreeing that SVB was wrong, but it's easy for us arm-chair folks to second-guess the wisdom of creating a business model that was doomed in a once-in-40-year-catastrophe. But, "Silicon Valley" was in the name and 40 years was a long time ago, so why not.

[postexitus]

Risk management is not that difficult. Interest Rate exposure is a first order risk that even juniors should be able hedge out properly - it's not some exotic event where correlations went out of whack or something. These guys were either clueless / had no visibility into their balance sheet or outright criminal.

[Mezzie]

I'm a child of a bookkeeper with no econ training under my belt and I know about interest rate exposure and risk hedging. And there have been discussions since 2008 about how long QE and low interest rates could last, it's not like that was a new question.

[dsomers]

Exactly