Matthew Yglesias

Matthew Yglesias @mattyglesias

Is that actually true? I see reason for skepticism. But it’s also challenging to go ask for an exemption to the rules on the basis of systemic significance when you lobbied nonstop for a decade on the theory that you’re not. You maybe convinced some people. — PolitiTweet.org

Matthew Yglesias @mattyglesias

These institutions could have made the opposite case — that they were systemically significant and in need of the kind of guarantees and regulations the GSIBs get. But their leaders chose to claim to believe that liquidating then would be fine for the national economy. — PolitiTweet.org

Matthew Yglesias @mattyglesias

America’s large regional banks fought and won a ferocious years-long battle across congress and several different regulatory agencies to secure exemption from Dodd-Frank rules on risk and safety specifically by arguing there was no systemic risk to normal FDIC resolution. — PolitiTweet.org

Matthew Yglesias @mattyglesias

@EpsilonTheory I agree that banking with a regional bank is dumb (I don’t do it) but I’m curious why you’ve only realized it this week. The relevant policy changes happened over a decade ago, and I assumed regional bank loyalists had some reason. — PolitiTweet.org

Matthew Yglesias @mattyglesias

For better or worse depositors getting skittish leading to higher interest rates on demand deposits and less bank lending would, I think, be *desired* outcomes of the Fed’s current policy trajectory. That’s how you get from rate hikes to less inflation. https://t.co/EsgfwulIqq — PolitiTweet.org

Matthew Yglesias @mattyglesias

Worth noting that @sama, @vkhosla, and others are acting responsibly, trying to help people in constructive ways, and contributing to a calmer situation — that is good. Be like them. https://t.co/Lp6x1uV62a — PolitiTweet.org

Matthew Yglesias @mattyglesias

@kimmaicutler No, the FDIC has been selling assets all weekend to recover funds for uninsured depositors. This is the process laid out in law and policy and the FDIC statements. They unfortunately cannot promise exactly how much will be raised at auction but it’s much more than $250k. — PolitiTweet.org

Matthew Yglesias @mattyglesias

@MattBruenig This was I think a New America Foundation proposal from the mid-aughts that didn’t go anywhere because it doesn’t make sense — PolitiTweet.org

Matthew Yglesias @mattyglesias

Shouldn’t there have been some Prompt Corrective Action order much earlier in this process? That interests rates were rising was not exactly a secret. — PolitiTweet.org

Matthew Yglesias @mattyglesias

@EpsilonTheory Why? Uninsured depositors have taken haircuts in bank failures before. — PolitiTweet.org

Matthew Yglesias @mattyglesias

Are you trying to deliberately foment mass panic in hopes of avoiding a modest-sized personal financial loss? Consider not doing that. https://t.co/78RcDRjWdt — PolitiTweet.org

Matthew Yglesias @mattyglesias

The All-In Podcast is a risk to financial stability. — PolitiTweet.org

Matthew Yglesias @mattyglesias

Note that when SRE authority was actually invoked during the last financial crisis, everyone got furious (bailouts!) and congress narrowed the authority. https://t.co/5qPUnU6OeF https://t.co/tBTovrhFky — PolitiTweet.org

Matthew Yglesias @mattyglesias

Under what circumstances can the FDIC deviate from the statutory requirement to minimize taxpayer costs in the resolution of a failed bank. Well Diane... https://t.co/kxxWRdPWW3 — PolitiTweet.org

Matthew Yglesias @mattyglesias

I don't think issuing midnight demands for the president to go do something illegal is a very responsible course of action. — PolitiTweet.org

Matthew Yglesias @mattyglesias

@kimmaicutler @ClaraJeffery What the FDIC said on Friday was depositors will have access on Monday. All the VC twitter rumor-mongering, deliberate spreading of panic, and demands for the regulators to do illegal stuff are not helping to boost sale prices or speed anything. — PolitiTweet.org

Matthew Yglesias @mattyglesias

Suppose you were a very rich person who had a ton of money in an account at SVB and you lost a share of that money — you’d be mad! I’d be mad too! But that’s not an economy-imploding scenario in which nobody can access their deposits or pay their employees. — PolitiTweet.org

Matthew Yglesias @mattyglesias

There’s this false dichotomy between evil “bailouts” of SVB’s creditors and doommongering about inability to access deposits and make payroll. What if the FDIC just does normal resolution, sells assets, everyone can access accounts tomorrow, but depositors lose some money? — PolitiTweet.org

Matthew Yglesias @mattyglesias

@kimmaicutler @ClaraJeffery The FDIC is selling SVB’s assets and giving the proceeds to SVB’s depositors — all the drama about ability to access the funds is a made-up problem. The very real problem is the asset sales may not cover 100% of the tab so the people who lent SVB money will lose some of it. — PolitiTweet.org

Matthew Yglesias @mattyglesias

29 … I am from the southern part of Manhattan — PolitiTweet.org

Matthew Yglesias @mattyglesias

@l2k Did the investors who built the long-term relationship with SVB know that their bank was taking on tons of unhedged interest rate risk that threatened their uninsured deposits? — PolitiTweet.org

Matthew Yglesias @mattyglesias

@BobEUnlimited What action would you like to see taken and by whom? — PolitiTweet.org

Matthew Yglesias @mattyglesias

If the regulators had been tougher on your favorite bank that you felt had a unique understanding of the needs of your business and your industry and the bank came to you complaining about the loser bureaucrats who just don’t get it, who would you have sided with? Be honest? — PolitiTweet.org

Matthew Yglesias @mattyglesias

There has been a lot of blaming of government officials for errors in business judgment, demands for the FDIC to do things that are illegal, special pleading, etc and very little constructive engagement with the tradeoffs and difficulties of bank regulation. — PolitiTweet.org

Matthew Yglesias @mattyglesias

Respectfully, I don’t think anyone is rooting for the tech sector to fail but I do think a lot of us are rooting for the tech sector to manifest some *humility* — PolitiTweet.org

Matthew Yglesias @mattyglesias

At least some of the uninsured deposits will be unfrozen first thing Monday as SVB’s assets are sold off over the weekend which should avert payroll emergencies. https://t.co/eQexvTxAHV — PolitiTweet.org

Matthew Yglesias @mattyglesias

@nilocobau @nbeaudrot @tysonbrody Yep — PolitiTweet.org

Matthew Yglesias @mattyglesias

@nilocobau @nbeaudrot @tysonbrody Chicken fried chicken (dinner pic) https://t.co/u7raY4ELOK — PolitiTweet.org

Matthew Yglesias @mattyglesias

Like why did Vox Media, which is based in DC and New York, use Silicon Valley Bank? Well they raised VC money from Silicon Valley and a huge share of companies who did that regardless of sector or location ended up with SVB. Why? How? https://t.co/6hFHR09Ncb — PolitiTweet.org

Matthew Yglesias @mattyglesias

Not saying there’s anything nefarious about it, but it seems like a non-obvious outcome — as far as I know various Substack entrepreneurs are not clustered in one particular financial institution — and the story of how they came to dominate this niche is interesting. — PolitiTweet.org