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johnbellone on March 10, 2023 | parent | context | favorite | on: FDIC Takes over Silicon Valley Bank

Isn't that the definition of uninsured?

function_seven on March 10, 2023 [–]

No. If I crash my car into a $80,000 BMW and totaling it—and I have no insurance—the other party will still be able to sue me and partially recover their losses. Maybe they get $63k from me and eat the other $17k.

The bank has assets. Just not enough to cover all liabilities. That's why you see the term "haircut" being used a lot in these threads.

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