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Comment by nine_zeros | Hacker News Reader

> People are crying because this is just another case of the rules not applying to the wealthy.

How so? Literally the wealthy investors and executives of the bank lost all their stock wealth and compensation.

Mark Cuban says he has $8-10M at SVB via his funded startups. Rich guy bailout to be paid by increased FDIC fees and reduced Fed 'earnings' paid to USA. Everyone is forced to pay so billionaire Mark Cuban gets his millions.

The startups are the ones that get the funds now, right? The startup now is guaranteed to have the funds to pay their employees etc. Mark Cuban gets money if his investment in the startup is a success, and only then. I’m happy the startup can now survive. What exactly is the issue?

The issue is the US public paid into the startup via the bailout and doesn't have the corresponding shares. It's making the general public pay for the down side while having the rich VCs get the upside

> The issue is the US public paid into the startup via the bailout and doesn't have the corresponding shares. It's making the general public pay for the down side while having the rich VCs get the upside

There is no tax payer money in the bailout because there is no bailout.

A lot of the reputable coverage I'm seeing is saying that they don't want us to think its a bailout, but it's indeed a bailout.

> A lot of the reputable coverage I'm seeing is saying that they don't want us to think its a bailout, but it's indeed a bailout.

Sounds like the coverage you are reading is either misleading you or is misled themselves.

It’s indeed very complicated in any case. My understanding is a vast majority of the funds to cover the depositors is/will be coming from (1) the eventual sale of SVBs assets, which is worth an unknown amount given the FDIC must sell all assets within a few years (3-5?), and (2) the $250k insured amount from FDIC’s DIF. Short term the FDIC is providing an advance dividend to cover as much of the depositors as they can.

Where the remaining amount is coming from, however much that ends up being (an unknown), is an unknown as far as I understand. It could come from a “special assessment” (a way for the FDIC to collect additional money from banks)… of which some could possibly be passed down to consumers eventually I think, indirectly, or just worse terms. If so it might be a relatively small amount of the total assets, but I have no idea - depends on the sale of SVB’s assets.

isn't the insurance fund ultimately something the taxpayers would be backing since it is the something the banks pay into the FED?

Iirc SVB’s assets aren’t enough to cover all withdrawals, esp if sold now. FDIC is either taking of the risk or covering the diffs. Money has to come from somewhere.

> Mark Cuban says he has $8-10M at SVB via his funded startups. Rich guy bailout to be paid by increased FDIC fees and reduced Fed 'earnings' paid to USA. Everyone is forced to pay so billionaire Mark Cuban gets his millions.

Did Mark Cuban mismanage the bank? Why should his deposits get penalized?

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