The first few banks to fail did have some consequences on those responsible, but all the actions to make deposits whole are, in practice, making it it far harder for the next layer of unsafe banks from getting wiped out.
Imagine that the Fed guarantee for SVB had been put forward two weeks before it was. Would SVB shareholders and managers had received the same level of consequences? Any consequences at all? I am not sure of how big the difference would have been, but I would be surprised if it wasn't significant.
> Imagine that the Fed guarantee for SVB had been put forward two weeks before it was.
The fed guarantee is only for banks that are solvent. Banks that are insolvent have been put in receivership. In fact, the fed didn't guarantee SVB anything, they guaranteed that deposits at National Bank of Santa Clara, the successor to SVB, are safe.
Except SVB and signature shareholders lost all their money and most of the employees will be fired...
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