I don’t know how this is going to go (understatement alert)
Saturday March 11th 2023, 10:48 pm
Filed under: History

The abrupt Silicon Valley Bank collapse: the accounts that vanished in the last few days were the ones that smaller-to-middle-sized companies simply doing normal business rely on to make payroll.

If the early reports and gossip are true, the richest investors triggered the run via insider information. They bailed themselves.

California law does not allow businesses to not pay workers on time, not anticipating situations where they’re scrambling to get at their own funds in their own bank accounts so they can do so. Legally right now, they could tank as fast as that bank.

This isn’t about bailing out the rich, it’s about rescuing those of us at the worker level who rely on that next paycheck, whose employer was perfectly solvent, successful, and had fully expected to continue from day to day.

Note that a few decades ago, Chrysler repaid the Feds in full and early. Different business but still a useful precedent.

Edited 3/12 to add: one of the companies that had its money in that bank? Etsy.

3 Comments so far
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Oh I hope it doesn’t spiral into another crash!!!

Comment by Jayleen Hatmaker 03.12.23 @ 8:21 am

I’m honestly so surprised that banks can fail these days. Naïve of me, no doubt. I hope you don’t get too badly caught up in it.

Comment by ccr in MA 03.12.23 @ 8:51 am

One factor here: the bank exec lobbied for less regulation under Trump and got it. I do wonder if this wasn’t tech if it would get this much attention.

Comment by Renee 03.12.23 @ 2:16 pm

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