If he buys it, would this be the first bank to fail twice?
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Yes, but the FDIC only insures depositors up to $250k. We’ll be on the hook for the rest when they decide that the businesses and billionaires are too precious to fail. I hope I’m wrong, but this happens over and over and over and over…
ETA: Also, FDIC only insures the depositors. I have a feeling that a tremendous amount of assets are tied up elsewhere.
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Sadly, the ghouls are already on the case:
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This is the opposite of what the proponents of crypto promised us. Maybe it reflects a liquidity crunch in which everyone freezes and says “what next?”
ETA Ignore me: I don’t want to derail this thread with Bitcoin discussion.
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Larry Summers behaving true to arsehole form as usual. This is one of the geniuses who helped tank Russia’s entire economy back in the 1990s. If he wasn’t so deeply enmeshed with the DC and academic establishment no-one would listen to him.
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Here come the vultures…
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Just like cholera, hedge funds are ever eager to remind you that liquidity can be a dangerous thing.
So far the only part of this that does look to be a more safely contained trainwreck is the large and growing collection of the ‘trust us, we’re respectable and have real money, we swear!’ crypto-things that turned out to have whatever real money they had tied up here.
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liquidity can be a dangerous thing
True, and come to think of it, maybe that’s all there is to Gates buying all that land. 
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Welcome hexapodium
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This looks like it was part of a regular plan to sell stock – he’s selling a chunk every quarter or so according to a quick look of the SEC reports. There’s a rule that insiders can file a plan with the SEC to inform the SEC “I’m going to sell X shares on the last day of each quarter from now until 2025” or “I’m going to sell $1MM worth of stock on the last day of the quarter” or whatever. If you stick to that plan, there’s no insider trading violation. If you deviate from that plan – selling more or selling less – then the SEC is going to look into why you did what you did.
(The Marketbeat version is easier to read, but may be paywalled)
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my understanding is that the money isn’t gone… it’s trapped. so one could swap the illiquid money with an equivalent chunk of liquid money and then cash out after the bonds/ securities come due with no one worse off
what is a bit weird is: lots of businesses and even city and state governments put their money into the big banks precisely to cover these kinds of issues.
local banks and credit unions are usually considered too small to handle that level of cash. but if the feds are willing to sweep up the debt themselves, it puts the lie to using the big banks at all
i think it’d be such a different world if they didn’t have the gobs and gobs of taxpayer and consumer money to milk interest off of and to speculate with… so im sure keeping that system intact is something the feds will attempt to do 
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Astounding first post, there. Accurate, readable summary of what was going on and why they failed. Do stick around and may all your contributions be this good.
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That’s probably these guys’ plan. Buy the deposits at a discount and then buy some congressmen to be made whole. PROFIT!
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tl;dr: Silicon Valley potato famine.
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I don’t follow the potato famine analogy
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The bank had a monocrop of depositors, and worse yet, an even smaller group of VCs.
Blam! Their whole crop gone at the same time.
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This is silly. When the big VCs who encouraged the run learned of the looming issue they had a few different paths to choose from a) bail the bank out, b) do nothing, c) stab them in the back.
From everything I’ve read SVB had a problem and should have foreseen the cash shortage but wasn’t so far out of bounds that they’d have collapsed without the run on the bank. They would have managed through it.
I wonder what the logic behind choosing C was.
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A collective action problem? Unless they were sure that everyone would act together to save the bank it was rational for any given smaller depositor to try to pull out their deposits while they still could. Plus SVB probably didn’t have a sympathetic George Bailey character to try and reason with the customers.
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Well I suppose if the depositors had no choice about whether to bank at SVB, then I guess I see the analogy working.
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