Any bankfags around? Is this the SVB scam?
(media.patriots.win)
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Close. The Treasury is funding itself. That's silly, but it's not the problem.
The problem is that it gives license to banks to steal. Any bad investments made by a bank (e.g., loans to friends) will be forgiven, and the bank will be bailed out. This is a license to steal; the inflation is secondary.
I'm confused about the bailouts. Depositors will be OK, but investors will lose, "because that's how capitalism works," as Biden said. True?
In the case of SVB, the bank is closed and has no assets: stockholders and bondholders alike are out of luck. But accountholders don't lose any money.
In theory, no bank ever owns depositor money. The money is accounted for separately from assets they own. That's why bank size is often measured as "assets under management." They are allowed to use it (customer money), but not to own it.
They are always required to hold customers' money plus reserves; their license to leverage and play with customer money depends on their ability to manage their reserves. With no reserves, they can't be a bank anymore.