Comments by "MarcosElMalo2" (@MarcosElMalo2) on "Bank Failure Should Not Cause Problems for Anyone" video.

Was it a bank or a savings & loan corporation (or other quasi-banking business)? I would doubt your story if it was a bank because the FDIC took over regulation of banking and deposit insurance in 1933, but did not regulate the savings & loan business. The main differences between the two for the average consumer was that a S&L offered higher interest rates, couldn’t offer checking accounts (until the 70s), and were a relatively riskier form of investment than a deposit in a bank savings account. A S&L could operate LIKE a savings bank but was outside the banking system. I’m not saying you’re lying, but your timeline makes no sense if it was a bank that failed. You’d have to be over 100 years old. If it was a S&L such as George Bailey’s financial institution in It’s a Wonderful Life, it would fit your timeline and your age.
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@robertchaplin The usual reason is bad loans and investments beyond the institution’s ability to absorb losses. It can even happen that the bad loans or investments aren’t bad long term, but a market downturn causes the bank to have insufficient funds for daily operation. The SVB failure was due in large part to a short term investment in a relatively safe long term investment, T-Bonds. Short term, they were underwater and would have to liquidate at a loss to have sufficient cash on hand to operate. This in turn caused depositors to withdraw their funds en masse (a run on the bank) which compounded the liquidity crisis. The bank had insufficient cash on hand to see it through changing market conditions.
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