How do banks even fail in the first place? They literally just exist and people put money in them. How the fuck do they fail so much at their sole purpose that they lose money
Discussion
Like you literally just have to sit there and take our money how do you fail at that
They failed because they bought bonds or something and the feds raised interest rates high and they were not making any money or something
Banks can fail for various reasons, but the most common one is when they become insolvent, meaning they lack the funds to cover all of their customers’ deposits and the money they owe to others. This might happen because the bank loses too much on its investments, has problems refinancing its debt, or faces a sudden withdrawal of deposits by customers who lose faith in the bank.
Silicon Valley Bank, collapsed after it ran out of cash to pay its depositors. The bank had been struggling with bad loans and lawsuits from tech companies that accused it of fraud and mismanagement.