[Rusty J]

Yup, easy to gamble if you have a safety net.

Depends on who's gambling.
The execs and bank shareholders get wiped.
Depositors are made whole.
The only unusual part is covering deposits above the $250,000 guarantee limit, and that's out of the insurance fund the banks paid into, not general funds.

This was a bank run (liquidity crisis) rather than insolvency (capital crisis). Poor inflation-risk management, rather than the bank holding assets whose value disappeared outright as in '08.
The bank's new owners (another bank that agreed to buy it) have sufficient capital to keep it running.

 

[DarisPakar]

Yes and no.

No, because economics should be apolitical (it is what it is).
Yes, because intervention is a governmental action, and governance is political.

So we are left holding a big empty bag of ( it is what it is ). 😇

 

[DarisPakar]

Rusty J, what do you think of the FTX Scandal ?

 

[Bluebottle]

This was a bank run...

I don’t understand these things as well as you but I was thinking generally, rather than this particular case.

As I understand it, they overspecialised and their customers were mostly tech startups - by nature engaged in social media, flexible and fast to respond. Too fast and too many for the banks to cope with and that made them vulnerable (?).

 

[DarisPakar]

AG Dave Yost Sues Norfolk Southern Over ‘Entirely Avoidable’ Train Derailment - Ohio Attorney General Dave Yost

www.ohioattorneygeneral.gov