government will provide a backstop in all cases, for all banks? well, i think that s what is happening as a practical matter with silicon valley bank. and so what that does is it creates the expectation that that will be trouble. when you add that to what president biden says. i think that s where people began to think the market is. and the rules are going to be. but to be clear, it s of the to congress. this fda seeing insurance agent was already raised from 100,000 to 250,000. i had a lot of calls with democrats, saying that this is ridiculous, the limit should be unlimited. it should be like 20 million. the point of that deposit limit has never been to insulate anybody from any amount of risk. it s not what it does. but isn t that exactly what s happening now? are you saying you do not think it s a good idea for what they ve done right now? which is a very clear
with silicon valley bank, so what that i think does is sort of create the expectation that will be true when you add that to what president biden says, i think that s where people think the market is what the rules are going to be. but to be clear, this is up to congress them fdic insurance limit was already raised from 100,000 to 250,000. i had a lot of colleagues say, the limit should be unlimited. should be $20 million. the point of that deposit limit has never been to insulate anybody from any amount of risk. that isn t what it does. but isn t that what s happening now? are you saying it s not a good idea from what they ve done now, which is a blanket. we have to be clear. that kind of blanket guarantee of all deposits of any size no matter how big we have to be very clear, it s not free. it comes with costs.
take a deposit, they put it, because of regulatory requirements in treasury bonds. they theoretically, you know, not everybody pulls their deposits out at once, so they don t have to sell those treasury bonds. svb had to sell the treasury bonds. they re sold at huge discounts because of the volatility in the treasury market now and prices are down. you get what i m saying, it s hard to get the money out right now and the federal government is not going to cover the entire amounts of money in there, only the deposit limit which i think fdic insurance is $500,000. so, that s where we are. this could get kind of messy next week, particularly businesses. if businesses had money there and that s something i keep hearing, they re going to have a hard time getting all of their money out and will they be able to make payroll and these businesses are not small businesses. these are silicon valley type