No lie, I had an irrational fear that authorities would be summoned the first time I tried to deposit a large check (from consulting). I asked for a private conference with a banker so that I could explain the circumstances. Whereupon we had a very classic conversation:https://twitter.com/cperciva/status/1036423661673009153 …
-
Show this thread
-
Replying to @patio11
Reminds me of the Airbnb founders: “What’s the limit on this bank account?” “Excuse me?” “Could it hold... one million dollars?”
1 reply 0 retweets 32 likes -
Replying to @Austen @AustenAllred
That is not an insane question. I know a founder in a particular region in the US who sold the company to AppAmaGooBookSoft with the proceeds wired into their local bank, triggering an immediate call from an SVP (a real title at that bank): "YOU CAN'T PUT THIS MUCH MONEY HERE!"
4 replies 4 retweets 35 likes -
-
Replying to @SuMastodon @AustenAllred
Because if you have a demand deposit which is a material percentage of the total liabilities of the bank they both are incapable of putting that much money to work very quickly and, if they do, you can singlehandedly cause a bank run on any given Tuesday.
3 replies 1 retweet 30 likes -
"What's a demand deposit?" I'm glad you asked, Internets. One of the fundamental sources of value in banking is maturity transformation: "borrow short and lend long." The loans of a bank generally have long time scales (e.g. 30 year mortgage) but deposits have much shorter ones.
2 replies 5 retweets 26 likes -
Replying to @patio11 @AustenAllred
Sorry just reread it and it made sense to me. Thanks for taking the time to explain it
1 reply 0 retweets 0 likes
No worries! Demystifying finance for geeks is basically a material percentage of my job.
Loading seems to be taking a while.
Twitter may be over capacity or experiencing a momentary hiccup. Try again or visit Twitter Status for more information.