Why Silicon Valley Bank Collapsed & What's Next
ฝัง
- เผยแพร่เมื่อ 9 มิ.ย. 2024
- The federal government stepped in to make all depositors at Silicon Valley Bank whole after the bank's stunning collapse over the weekend. Ana Kasparian and Cenk Uygur discuss on The Young Turks. Watch TYT LIVE on weekdays 6-8 pm ET. th-cam.com/users/theyoungturkslive
Read more HERE: www.wsj.com/articles/federal-...
"U.S. regulators took control of a second bank Sunday and announced emergency measures to ease fears depositors might pull their money from smaller lenders after the swift collapse late last week of Silicon Valley Bank.
The measures, which include guaranteeing all deposits of SVB, were designed to shore up wavering confidence in the banking system. They were jointly announced Sunday night by the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corp."*
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230313__TA01Bank
Silicon Valley Bank (SVB) was the 16th largest bank in the US, and it wasn't subject to the most strict controls. How many banks actually are subject to those controls, besides the big four? Any bank could suffer a run and fail, and if that happens to a community level or even state level bank it probably won't upset the national economy or ecosystem of banks, but any multi-state bank should be more closely watched.
Government policy has thrown the future under the bus for decades. The day of judgment is near. I predict an 80% drop in the stock market. Investors will abandon stocks in favor of real estate. There will be no money in banks... You must devise a strategy for survival
You have a very valid point, I started investing on my own and for a long time, the market was really ripping me off. I decided to hire a broker, even though I was skeptical at first, and I beat the market by more than 9%. I thought it was a fluke until it happened two years in a row, and so I’ve been sticking to investing via an analyst.
Such a priceless tip, Thank you so much!
This is absolutely fantastic the way good work speaks I practically see Sofia Erailda everywhere
@Jane Viella she actually appears to be well-read and educated. I just did a Google search for her name and found her webpage, I appreciate you sharing
Considering the recent developments involving SVB, Signature Bank, and First Republic Bank, reminiscent of the 2008 market crash, is it prudent to continue saving in the United States dollar? Alternatively, would it be wise to contemplate investing in gold amidst these circumstances?
Given the current market situation and the precarious state of the economy, I would recommend refraining from investing in stocks for a while or, alternatively, seeking guidance from a financial advisor. However, keeping a portion of your wealth in gold remains a wise choice.
I consider gold investment to be dependable and intend to increase my holdings to recoup losses. While silver is also a promising investment, it differs from my collectibles. Having clear investment goals and acquiring knowledge in the field are essential. I collaborate with Laurel Dell Sroufe, a financial consultant regulated by the SEC. Through modest initial investments, I have gradually accumulated nearly $799k over time.
@@tatianastarcic How can i reach her, because I’m seeking for a more effective investment approach on my saving.
@@maiadazz Laurel Dell Sroufe maintains an online presence that can be easily found through a simple search of her name on the internet.
@tatianastarcic she actually appears to be well-read and educated. I just did a Google search for her name and found her webpage, I appreciate you sharing
What happened to SVB is really scary, and goes to show that no corporation, however big, is immune to collapse. I have always had a deep-seated mistrust for corporations. I have plans to pull out most of my money, but don't know what to do with $350k sitting idly. I'd like to go into the stock market, maybe. Any ideas?
All big corps are just a cohort of centralised system working together, and any damage to one can have a dangerous ripple effect on every other one. I learned a long time ago to not trust corporations. Most of my money is in the stock market and my businesses. I keep only what I need to spend in my checking account.
Ironically, these are the conditions in which life-changing money is made by those who remain calm, patient, and take controlled risks. Vola tility goes both ways. The banks are in a big crisis. The market looks very shaky. The bigger the red candles, the bigger the green ones. I have made over $ 280k in the last 4 months by investing through my FA.
Wow. I've heard similar success story from people who work with advisrs. How do I get in touch with yours, please?
There are many you could potentially find online. I personally work with Deborah Sue Bohn , and she's been spectacular. But there are also many others you could check out yourself.
Thank you for this Pointer. It was easy to find your handler, She seems very proficient and flexible. I booked a call session with her.
I’m a 2-person vendor to an SVB customer. I didn’t get paid on Friday, and have no idea when I will. But what happens to us “little people” when we pay bills late…things like evictions, repos, disconnects, hits to our credit. What happens to incompetent, arrogant bankers….bonuses, stock sales, severances, tax payer bailouts. This is the system at its finest.
It is very sad you and millions of us, but our souls are more important and they cannot destroy which is their plan
Stop Over Acting
@@spiffingbooks2903 please tell the world you are joking, but it's not funny.
@@TheKingkingg No Im not joking. The reality is that relatively small depositors such as you were never at risk of much more than a few days of inconvenience. The issue is whether massive corporate investors such as Circle (backed by Goldman Sachs and Blackrock) with $3.3 Bn deposits would also be bailed out. Obviously if Goldman partners had gone on the talk shows and begged for a $3.3bn bail out from tax payer / bank depositor funds, they would have had little sympathy. Therefore they had to rely on smaller investors kicking up a political storm and forcing Biden / Powell to bail out ALL depositors - including the multi billionaires.
@benny soda No I'm just someone who objects to regular people like me and you be bailing out billionaires. No problem with bailing out those with modest deposits if say up to $10m. I object to bailing out the likes of Circle -a crypto scam business backed by Goldman Sachs to the tune of $3.3bn. If you think this is a good way to spend public funds, please explain why .
The failure of Silicon Valley Bank has torn into global markets, with investors ripping up their forecasts for further rises in interest rates and dumping bank stocks around the world. I'm at a crossroads deciding if to liquidate my dipping 200k stocck portfolio, what’s the best way to take advantage of this bear market?.
The SVB situation is a reminder that Fed hikes are having an effect, even if the economy has held up so far,” It’s precisely at times like these that investors need to be on guard against the next certainty. You don’t have to act on every forecast, hence i will suggest you get yourself a financial-advisor
@@AshtonGrace I think it's brilliant to use a brokerage advisor for investing. Prior to speaking with an advisor in the heat of the 2008 financial crisis, I was actually experiencing terrifying nightmares. In summary, with the assistance of my advisor, I have grown my initial $20k investment to over $250k.
@@ReidCoffman1 I’ve actually been looking into advisors lately, the news I’ve been seeing in the market hasn’t been so encouraging. who’s the person guiding you?
@@MariusNatt Maria Teresa Tyler is the adviser guiding me, she is verifiable on the web.
@@ReidCoffman1 Thank you for the lead. I searched her up, and I have sent her an email. I hope she gets back to me soon
Screw the investors. Imprison the executives.
They did nothing wrong. This was a run the bank. Not a financial scandal. Pay attention before you start screaming "Crucify them!"
Steps to follow for failing banks ( there is a precedent in a Scandinavian country):
1) Don’t bailout the bank
2) Put in jail all its executives
3) Nationalize the bank
4) Clean up the mess
5) Resell the bank to the public
6) Do not compensate current investors
You save taxpayers money 🤷♂️
In this case I don't think #2 really applies. It doesn't look like they didn't anything wrong, they just got caught in a rapidly changing bond market.
@@wheelhouse15 they had almost no diversity and they over leveraged the shit out of their deposit to loan percentages. Federal currency reserve banking. They essentially loaned out 100% of their deposits which used to be illegal before the deregulation of Dodd Frank.
@@wheelhouse15 they did a lot wrong my man otherwise they wouldn’t be the topic of tonight’s discussion. They didn’t loose the lottery. They played fast and loose in a game with rules
@@jeffreyhall76 I don't see how they played fast-and-lose when they were investing in US Treasury bonds (I'm not sure what they had in bills, notes and bond, etc). If anything, it was the completely opposite of fast-and-loose, they were actually cautious and got caught flat-footed when rates spiked.
As for banking reserves, even if they held 10% it wouldn't have been enough since they were hit by a huge run.
I think the major issue was that they didn't do proper market analysis and didn't properly identify the risk of rapid interest rate hikes. If they had, they should have sold their longer term bonds and gone with the short-term bills. This would have allowed them to turn over their investments much faster and allowed them to pace the rate increase more closely.
Yup. Iceland did it right. They took a short-term hit, but came back better.
Anyone who had over $250,000 in the bank should have had to pay for insurance to cover any excess deposits. Otherwise, screw them. Taxpayers should not be on the hook for their mismanagement.
They did nothing wrong. This was a run the bank. Not a financial scandal. Pay attention before you start screaming "Crucify them!"
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
In all honesty, I'm curious in their management and financial structure. The beginning of a financial disaster is now. It's unsettling to not know which bank to hold onto.
I don't use new banks.
This goes to show the essence of financial/risk management
@Matt Van Wie I concur with you. primarily because experts manage the majority of these strategies and loopholes better. By taking my coach's recommendations, I was able to scale from $35K to 65K throughout this crash.
@@joecaruso06 Coming from someone who has participated both proactively and passively. I completely concur that it is best to ask an expert for assistance as you learn at your own pace. For instance, I've been able to create a $262k portfolioo following - Yvonne Annette Lively guide. Financial security is obtained by careful saves & Invst.
@@maryalchester Mind me asking if she was recently featured with Tate on a Fin-up pod recently? Talking about Yvonne Annette Lively
Big picture - what you guys reported is mostly true. However, there is also incompetence of the highest level at Silicon Valley Bank due to a lack of risk management and not putting on interest rate hedges, especially knowing that your bank's holdings are so heavily concentrated in bonds and fixed income securities.
Very true. This should have been basic risk management for a bank. First and foremost, this is a failure of a private business (capitalism) caused by greed and stupidity.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
Thank you for explaining this mess. You are one of the few networks that I trust.
have you done a CT scan lately to check if you're braindead? lmao
Tyt does great work
@@redcapitalist Have you any specific objections to their findings that you'd care to share?
@@toddmorningstar4206: LOL you know the answer to that, why even bother asking? He's clearly a Chump supporter, he probably thinks CRT is being taught in kindergarten with cat-litter boxes being provided as toilets while they all get stoned listening to a teacher talk about how wonderful "transgenderism" is.
SVB wasn't diversified enough among its customers and investments, leaving itself vulnerable to rising interest rates. Most of its loans were in the tech sector, while its investments were in long-term treasuries. BOTH of them are struggling against rising interest rates, which the bank didn't hedge against. Deregulation plus incompetent management are why this bank failed.
Thank you!!! Nobody brought this up and people assume this is another 2008 when it is not!
The thing about interest rates, they are lowered when the economy is slow which can cause layoffs and job losses to get people to spend less money. They are raised when there is less product and more demand, which raises prices, for instance if there is a fuel shortage, they raise the price of fuel, and that causes every product to cost more to transport and deliver, it causes inflation. A bank should be diverse enough to handle both situations and prepare for it. To be clear, when gas prices went up, it wasn't because we had a shortage of Fuel, it was OPEC that purposely cut back on the production of fuel, to cause the US to experience inflation, why? Because they wanted their Trump Puppet back in office so they could continue to everything they could to use his greed to cripple our country, tear it apart, and have full control of all of the oil producing countries in the world. So when the interest rates are going up, that is a good thing, it means our country is fighting to keep us out of inflation, and to keep our economy healthy.
@@jc478 I agree with
*most* of what you said but I think OPEC was price gouging - plain and simple. These oil companies do what ever they want to do no matter who the president is.
And I'm glad you mentioned the fact that they cut back on production on purpose. Most people think Biden had something to do with it but he didn't. Presidents don't control oil production.
They want to inspect banks, in particular smaller banks run by hedge funds because they use deposits like capital in their hedge fund. They win, and get rich, they lose nothing and walk away from it. The billion-dollar loss is a fraction of the bank's value, I suspect they were doing hedge fund things like Crypto hedge and Crypto just collapsed and then this happens in this tech/Crypto bank.
@@JoniDiMaggio Oh definitely there was price gouging, but I do believe they were raising it to increase inflation on the US as well. Biden's infrastructure threatens their way of life, and the idea of weaning off of it, is not something the big oil wants to do. They should be putting money into newer forms of energy, instead of trying to stop progress. Anyway, that is why so many of the oil countries are not wanting Biden around, and they made more money than ever.
They stopped a bankrun this time to save the economy and help out the customers not the investors. At least they seem to have learned from the 2008 collapse.
The customers are a lot of "businesses" with valuations in the millions and no cash flow. The "depositors" are really the cash for the zero-rate start-up funding by the VCs that were underwritten at this one industry fave bank because it had lax underwriting standards and gave out perks to the founders like favorable mortgage rates backed by future expected returns (used loosely, no cash flow needed). They then had to keep all their money in this bank to get the terms. It's not a particularly sympathetic story, but that's being obfuscated quite well.
NO ONE who deposited more than the maximum of $250,000 should receive an additional penny.
I'll say it again for those in the back: "Investing" is just the rich man's word for "gambling."
That is why you will die poor.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
@@michaelgentile9580
*_That is why you will die poor._*
Hilarious, coming from someone defending a bank that just went stone broke due to investing LMAO.
Go ahead homie. Gamble your money away. But don't come crying for bailouts when the markets crash. If you're willing to accept the wins, you damn well better be prepared to accept the losses.
*_The most capitalized bank in the US holds 6.5% in reserves._*
If they hadn't lost half their depositor's money on a gamble that went south, they wouldn't need reserves, now would they? YOU are clueless.
I still blame the FEDs for this, because in the end they benefit by either buying off the failed banks cheaper or something. The fed can print credit as long as someone will borrow it into existence, but they cannot print product (or production).
Every day we have a new problem. It's the new normal. At first we thought it was a crisis, now we know it's a new normal and we have to adapt. this year will be a year of severe economic pain all over the nation.. what steps can we take to generate more income during quantitative adjustment?I can't afford my hard-earned $180,000 savings to turn to dust
The idea of financial adviser aid may seem controversial to some, but according to a recent Investopedia survey, demand for financial advisors has increased by over 41.8% since the pandemic, and based on personal experience, I can say with certainty that their skill sets are top-notch. From a sluggish $385K that lacked growth stocks, I raised almost $500k in 18 months.
@@BenjaminMcLeod815 please who is the F/A guiding you
@@anthonymilner1088 Having an investment advisor is the best way to go. Based on a direct encounter with a CFP named Corinne Cecilia Heaney, I can say with certainty that their skills are excellent. She helped raise almost $500,000 in 18 months from an initially stagnant portfolio of $380,000.
@@BenjaminMcLeod815 Thanks for sharing, I just looked her up online and I would say she really does have an impressive background on investing.
I have Watch coverage on this from multiple new sources. You are only the second one out of 6 to explain it well.
banks are such a weird institution. Literally gambling with their customers money. if they win, they gain the profits for themselves. If they lose, the customer lost thier money. Insanity
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
@@michaelgentile9580 lmao. Yes, because they're gambling with the other 93.5%
@@fetB This was a planned and executed take down of SVB. This was intentional.
Thanks for explaining this in a responsible way.
Just before this happened they gave themselves big bonuses
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. No regulation in the world would have made one iota of difference. You are clueless.
The fin-Market;s have underperformed the U.S. economy as fear of inflation hammers the prices of stock;s and bonds. My portfoliio of $750k is down to $592k any recommendation;s to scale up my return;s during this crash will be highly appreciated.
Very big con and that is why i have always maintained that people should never have their money in the bank! Get a financial advisor and even make so much more while saving!
@@Isaacmeide Based on personal experience working with an investment advisor, I currently have $385k in a well-diversified portfolio that has experienced exponential growth. It's not only about having money to invest in stocks, but you also need to be knowledgeable, persistent, and have strong hands to back it up.
@@kevsmills wow ,that’s stirring! Do you mind connecting me to your advisor please. I desperately need one to diversified my portfolio, I am so done with banks!
@@andreasleonard0 Isabel Linda Dueri” is my portfolio-coach, I found her on Bloomberg where she was featured, I looked up her name on the internet. Fortunately I came across her site and reached out to her, you can verify her yoursel
@@kevsmills Thank you for this amazing tip. I just looked the name up, wrote her explaining my financial market goals and scheduled a call
The CEO should be forced to go bankrupt over this
Agreed. The government is make ng SVB fire the big wigs, at least.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
I love the way you guys volley. You both are my newly favorite news commentators.
Im a professional institutional trader, to say this bank did not make risky investments is incorrect. Banks entire business model revolves around managing interest rate risk, and the company willingly decided not to hedge this risk with interest rate swaps, this was a bet against the Fed hiking rates. Being a bank it is your JOB to among interest rate risk.
Also basic business practice is to sweep your excess cash into a MM since you know the limit is 250K AND you'll earn a better yield on excess cash, this was PURE NEGLIGENCE. by both depositors and the bank,.
As a professional, do you think depositors, that paid for private deposit insurance, for the balance over $250K, should be reimbursed by the feds for their premiums.
@@wadestanton they should be reimbursed by their private insurer obviously. Why should the state care?
@@Stewiehleba Why should the private insurer be forced to pay out if the feds are covering those that didn't value there deposits enough to insure their deposits.
I remember in the early 1990s Orange county in California went bankrupt. My husband lost his job. Orange county had invested it's money in stocks that were effected by interest rates. The county laid thousands of county employees.
Perfect example of: "privatize the profit publicize the loss". This statement should be the anomaly not the basis for running a business or obscurely written into laws. It guarantees that the "risk takers" never loose a dime.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
This is what happens under deregulation
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. No regulation in the world would have made one iota of difference. You are clueless.
the bank paid out bonuses friday , just like 2008
Any bank that goes bankrupt should be covered for depositor losses but also converted into a non-profit credit union. Also, yes re-regulate them and require 5% cash or easily liquidated assets. The entire banking system is at risk of failure because the rising interest rates are reducing the value of bonds and therefore their investments are worthless.
❤❤😊😊❤❤❤❤❤❤❤❤❤00o❤❤000o😊
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
The best part is "it's not a bailout" even though every business will be made whole. This is just telling me the banks will survive regardless how bad they operate.
Imagine if you ran a business and you could steal your customers money without any consequences. Only to have the government pay back the people you stole from.
@@jobnieloliva5358 Well, if I could, I'd definitely have had my business banking in SVB.
It’s a bail out. You’re just playing the same games bush and the Republicans played in the early 2000s about torture.
@@Eric-oi5yj I thought I made that clear in a facetious kind of way.
This one will be liquidated because America needs it.
We should have listened to Bernie Sanders
If every time a bank collapses the government bails them out, why not have a US government bank for the citizens?
Oh yeah capitalism good socialism bad👍
God bless America
Exactly.. Eliminate the bank and allow us to open accounts at the Reserve.
yeah im sure you want government controlling your money so they can tell you get the jab or your money will be held like what happened in canada for disagreeing with the government. no thanks.
What is interesting is almost all the policies of the svb bank were democrat based, policieis in equity, equality and diversity. Things that have nothing to do with banking. They were also giving millions to blm and activist groups. The majority board were also democrat donors, no different to the twitter situation. Seems anything woke fails because they never focus on productivity.
The government failed because someone shouldve noticed the bank was failing. Just like how no one noticed inflation existed until it was 9 %. They all kept their jobs, so we keep employing incompetent people based on demographics and expecting different results. This will continue and get worse
@@craigclermond8001 why do you trust bankers so much?
Bankers in charge expected that interest rates would stay at historic lows forever. They didn't adjust along the year while interest rates has been increasing. They should be in jail.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
The bankers already grabbed their bonuses and split.
Grabbed their hundreds of millions and ran off. I hope they go after them.
The timing of Peter Thiels withdrawal in the series of events interesting.
and by “interesting” I mean “🤬suspicious” ✌🏼🤣👍🏼
Really bad take. Depositors and banks can buy excess insurance. There are also interbank programs like CDARS and MaxSafe to protect against loss over the FDIC limits. These business didn't have enough insurance to cover their asset and want someone else to take responsibility for their cost-savings risk.
FDIC is $250,000. People also need to diversify their banks. Play your money smart.
or buy private deposit insurance
Thanks!
My question is how did Peter Thiel get ALL his money out on day one???
I blame the FEDs for this, because in the end they benefit by either buying off the failed banks cheaper or something. The fed can print credit as long as someone will borrow it into existence, but they cannot print product (or production).
Every day we have a new problem. It's the new normal. At first we thought it was a crisis, now we know it's a new normal and we have to adapt. this year will be a year of severe economic pain all over the nation.. what steps can we take to generate more income during quantitative adjustment?I can't afford my hard-earned $180,000 savings to turn to dust
Having an investment advisor is the best way to go. Based on a direct encounter with a CFP named Corinne Cecilia Heaney, I can say with certainty that their skills are excellent. She helped raise over $580,000 in 18 months from an initially stagnant portfolio of $150,000
please how can i find the lady you mentioned'?
Corinne really seem to know her stuff. I found her website, read through her resume, educational background, qualifications and it was really impressive. She is a fiduciary who will act in my best interest. So, I booked a session with her
It's pretty freaking stupid to be investing in 1.56% bonds when there is 10% inflation and the Fed starts to raise rates. They should have been raising capital for the past 15 months! Seems like the CEO was too busy going after M & A deals business and had no clue how badly (90%) their assets were invested -in long US treasuries!
Bank lobbies for relaxing of regulations that would protect them from collapsing and in turn collapses. 😂😂😂😂😂
Why does the scorpion sting the frog?
Privatise the profits, socialise the losses.
Rinse and repeat, capitalism rocks!
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
@@michaelgentile9580 a small number of VCs caused a bank run, collapsing the bank, and then called for the government to bail out all the depositors.
Socialising the losses, after getting 0% loans (private profits).
I'm sorry this concept was too complicated for you to grasp.
*LETS REMEMBER - THERE IS NO REASON FOR INTEREST RATES TO BE HIGH* this is NOT a consumer-driven inflation - this is a SUPPLY SHORTAGE inflation + Price gouging
So Biden spending more money than has ever existed in the entire history of the US doesn't cause inflation?
@@SaintGerbilUK AND THERE YOU GO demonstrating a 3rd grade understanding of economics - NO IT DOES NOT, what does contribute to inflation is NOT taxing that money back in when it makes its way to the TOP 1%.
*GOVERNMENTS SPENDING MONEY DOES NOT CAUSE INFLATION* get that right wing bullsh!t out of your head - it stimulates the economy and creates jobs, what causes inflation is LEAVING that money in the system when it makes its way to the TOP 1%
"WHERE IS THE MONEY NOW...?" is the question you need to ask, and the answer is ALWAYS in the pockets of the top 1%
You are confusing *VELOCITY* of money with *QUANTITY* of money - and this is how the right wing brainwash badly educated people and this is WHY Reagan defunded education spending by nearly 50% to breed stupId people who say thigs like "So Biden spending more money than has ever existed in the entire history of the US doesn't cause inflation?"
Also he has not spent more money than bla bla bla what a stup!d statement.
@@SaintGerbilUK hahahahahaha, 🤡
@@SaintGerbilUK On top of signing massive tax cuts during a tight labor market (under GOP Congress),Trump signed two of the largest stimulus packages in American history, genius.
@@piccalillipit9211 So what is causing the inflation?
Its just a coincidence that unpreceidented inflation lines up with unpreceidented government spending.
You can't spend your way out of having spent too much.
Find me any president who has spent as much as Biden?
The US Budget used to be in Billions and under Trump it was 1-2 Trillion now under Biden its 20-30 Trillion.
It is NOT OUR PROBLEM if YOUR investiment turns to shit.
The investors got their money out first, hello!!!!
There are instruments too make sure your money is all insured. People who did not bother to protect their deposits do not deserve a bailout.
BANKS SHOULDN'T INVEST YOUR MONEY
Bring back Glass Steagall.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. No regulation in the world would have made one iota of difference. You are clueless.
If they don't invest it how do they pay interest? Where do you get a car loan? DUH!
Who did the deregulation
Bernie Sanders
@@woke_malecat NOPE! 😂 Republicans...mainly Dump.
Trump, All of GOP and Corporate Democrats. In May 2018, Trump Signed into Law the Economic Growth, Regulatory Relief and Consumer Protection Act through Bipartisan bargain where All Republicans and 17 Democrats voted for that Bill. A Bill that loosened or got rid of some key banking regulations. It rolled back rules that prevented banks that take customer deposits from making risky bets on the financial markets, mandate the size of banks’ capital reserves or how much cash they have on hand and require banks to perform routine “stress tests” that simulate a crisis to see if they can remain solvent. Now that Bill is what's backfired.
A Similar example to this would be the Texas Power Grid which was deregulated and is controlled by Electric Reliability Council of Texas which trades on supply and demand hence a competitive price market. In Feb 2021 Texas faced record low temperatures the state’s electric grid operator lost control of power supply leaving millions without access to electricity. So what were these deregulations that led to that? It’s the decision not to require equipment upgrades to better withstand extreme winter temperatures and the lack of diversity choice to operate thus mostly isolated from other grids in the U.S. hence no back-up systems which left Texas power system unprepared for the winter crisis. But of course the GOP was out there quoting and blaming ‘wokeness and green energy’ to rile up their ignorant base yet natural gas, nuclear and coal plants are the ones that provide & supply most of the state’s energy which heavily struggled to operate during the storm. Similar to Silicon Valley bank, The Laws Passed allowed the Banking System to Avoid having Capital on hand and the liquidity to deal with a situation like this. Instead of taking any regulatory action, they ended up getting guidelines that were unenforceable and largely ignored precautions in the rush for profits. Clearly we need to change our regulatory focus to protect the people, not profits.
The bankers should lose their jobs. The bank should go under. They could have invested in shorter term securities and not gotten pinned to heavy losses due to rising interest rates. It's clear that capital requirements are not high enough. The depositors for up to 250k should be protected. Every other depositor -nope. Etsy can pound sand. They can file lawsuits against the goons who ran the bank. If this was joe everyman, the bank would have bent him over and rammed it up his behind. It's time for an even playing field. Also, the fed needs to stop raising interest rates. Inflation is due to shortages and price gouging, not loose money supply.
You guys were the first in the breach for new news media and no matter what’s happened it’s clear y’all have the most time doing this cheers what a great program 🎉🎉🎉
The bank was most likely counting on a bailout for investors. About time, the right thing was done by the government.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. No regulation in the world would have made one iota of difference. You are clueless.
Best video explaining the svb meltdown.
How do you explain why the Fed or FDIC wouldn't allow SVB to be purchased by the prospective buyers who stepped up to the plate?
Why would they prevent that when they have fostered & facilitated that very solution themselves in the past and instead force the "failure" of SVB?
Actually, they shut down all those banks and the top four banks actually saw a huge influx of money already
Why don't they make the CEO`s of these banks pay the bailout money with their millions of dollars in salary? Isn't the CEO responsible for the bank failure in the first place?
Good idea. The executives pushed for deregulation, now let them pay for it.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
@@michaelgentile9580 The CEO ran the bank like a dunce. He was warned the bank was in trouble. He didn't heed the warning. I don't blame depositors for trying to pull out their deposits.
@@lisarochwarg4707 So you want me to believe that Glen Becker who was the CEO of the most successful venture capital tech bank for the last 12 years and former board member of the Federal Reserve Bank of San Francisco is an idiot? I don't think so. He's got you fooled into believing he's just some shifty banker. But, he's way more... He registered to sell his bank shares with the U.S. Securities and Exchange Commission on January 26, 2023 and the shares were sold on February 27, 2023. Following news of SVB's failure on March 10, 2023, Becker was reportedly no longer on the board of the Federal Reserve Bank of San Francisco.
That's not the resume or actions of a dunce. This was a planned and executed takedown os SVB.
Thank you!!
Thoughtful conversation. Really excellent!
Reaping the fruits of deregulation. If we can't afford to forgive student loans we can't bailout banks!
We're not as important as banks, you should know this, lol. Stay safe and much love from Colorado.
Forgiving student loans would literally involve giving trillions of dollars to banks
Progressive retards: print more money to counter inflation
@@mikew6060 And what exactly would your suggestion be?
@@toddmorningstar4206 don't invest in Government bonds because the FED is going to raise the interest rate
Management and others got their bonus off the top.
Thanks for being honest with what happened.
Good balanced financial report. Thanks
If we see any Golden Parachutes like in 2008, we are bringing our pitchforks and torches.
Lol! other than continue watching reality TV and celebrity worshipping, Americans of the modern era won't do jack squat!
If the bank president was put in prison for 20 years every time this happened it would never happen again
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. You are clueless.
@@michaelgentile9580
93.9% of SVB’s deposits were "uninsured" which is the second highest ratio among large US banks.
SVB had locked up 94.4% of these deposits for ten years in low yield US gvt bonds /mortgage-backed securities.
SVB had not left itself much room if deposit outflow increased which is exactly what happened.
They had to start selling off those bonds at a big loss. They ran out of capital quickly and failed.
In 2018, the bank president- Greg Becker lobbied President trump personally about the Dodd-Frank provision that set the threshold of 50 billion. He got is raised from 50 to 250 billion.
This provision had required strenuous govt oversight for any bank having a investment portfolio of over 50 billion.
One of those requirements regulated how much a bank's funds it had to keep liquid.
If that provision of Dodd- Frank had not been raised then this exact scenario would have been prevented.
It was the bank president that personally lobbied Trump to get it done.
It was the bank president that approved the investment strategy that left the bank dangerously exposed.
So as you can see. It is YOU that is clueless.
This lesson is free.
I will have to charge you for the next one.
No-one addressing the elephant in the room, which is that the reason for most of the problems in the economy is a lack of productive expansion. Simply put this is using MONEY to make (more) useful THINGS.
1:08 True but the ceo of the failed bank sold almost 4million $ of there SVB stock before anyone knew what was about to happen exactly 24 before the news came out actually.. he should be fined for 90% of the money he got selling the stock.
That may very well be illegal. Hopefully he goes to jail along with the Chief Risk Officer and CFO.
@@CL-gq3no Big facts!...
One of your very best discussions! Excellent reporting!!
I don't know enough about high finance to opine on whether bailouts in excess of $250k are warranted here. But I would like to know, what other rules exist only on paper that I am free to ignore with impunity?
After watching I don't know how many clips in my own language, Spanish, I finally understood with you guys, thanks!!!
There was no Chief Risk Officer in the SVB, why???
Glad I found you two! Very intelligent dialog.
Why they not saying the real reason behind it ,when it seems like it's because rich people invest their money in other countries Banks...😮
There is such a thing as "excess capital" in an economy. This is it.
I wonder how many of the VCs were shorting SVB stock.
Why not break up the big banks spread them out like the baby bells of the early 1980’s.
And just like 2008, there will be zero accountability.
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. No regulation in the world would have made one iota of difference. You are clueless.
@@michaelgentile9580 maybe you should watch the video and see why the bank failed before you respond to comments.
@@jamesjackson8667 The bank was perfectly healthy before depositors tried to withdraw $64 BILLION DOLLARS in a single day. Had the Fed injected liquidity SVB would be a functional bank today incubating American tech for the future rather than just a memory and a BIG WIN for China.
I saw that on the news! A dam bank going out of business. Wow, looks shady.
Probably one of the better explanations of what happened with svb and the relationship to overall cause and effects. Smaller countries have larger banks with deep pockets, so there is some stability there, but the lack of competition results in high fees for customers.
I agree that making depositors whole. How to pay for it? Higher fees for banks? More regulation? More Government? Difficult question.
Answer: make DEPOSITORS pay for their OWN deposit insurance! Pick a weak bank, deposit your money there, and lose it all in a bank failure? Too bad. Should have bought your own deposit insurance. Your are SOL!
They say that the taxpayers are not paying anything. The FDIC insurance fee will be increased for the whole banking system. So those who have bank accounts will have to indirectly pay for it. It happens that there is a large overlap between taxpayers and bank customers. So...
THEY STILL SCREWING THE WORKING PEOPLE
Another great program.
Can not forget
Good reporting on this story
When everybody was crying about inflation, the fed increased interest rates to slow it down, the problem is every action has an equal and opposite reaction, in other words, damned if you do, damned if you don't, and panic never helps anything.
Bank Run Prediction in a low-Confidence financial environment is like predicting earthquakes along a major faultline. Can't tell when it happens until it starts happening, but get really good at recognizing the signs of it happening and responding quickly.
If it's not really a bailout then the gov should go after all those bonuses that went out Friday to execs.
What’s crazy people lose their money but yet our taxes insure them through federal taxes 🤷🏾♂️
The depositors tried to withdraw $43 BILLION DOLLARS (that's 25% of total assets) in a single day. The most capitalized bank in the US holds 6.5% in reserves. No regulation in the world would have made one iota of difference. You are clueless.
So, if we have to bailout SVB, despite FDIC insurance for depositors, because of what may happen or is happening to mom and pop merchants, well, then what's the point of FDIC insurance? Right? We have to bail out everyone now regardless. This is kind of a bs argument.
They should probably just insure all of it, no more $250K limit, otherwise it is not fair to do it for some and not others. FDIC insurance is paid for by the participating banks, so maybe those banks would regulate each other since it is their money that the poorly runs banks are playing with.
This bank didn't even have a risk officer in its employ while 90% of deposits at SVB were above the $250K max FDIC coverage. Their main clientele, depositors over $250K, were drawn in with enticing sweetheart low interest to 0% loans and mortgages terms. Despite the fact the borrower/depositors at SVB have already received that huge perk, the government is saying they're going to make all the depositors whole. This is welfare for the wealthy. So does this mean everyone will have all deposits in U.S. banks guaranteed 100%, regardless of the amount, $250K limit be damned?
The problem is that if your backstop all depositors, then there is no incentive for keep their guaranteed interest returns down. They up the interest beyond what they can handle to lure more customers.
My god can people STOP with this crypto shit. It's literally ruining everything it touches
Nah, Crypto is surging, and it's a fantastic alternate asset. Look up "Fractional Banking" and "Central Banks." Then look up "inflation after the creation of the Federal Reserve." Finally look up "is the Federal Reserve actually part of the government or just a private bank." (Spoiler: it's a private bank)
Head down that path and you'll find all the answers to your economic woes.
@leon draisaitl you both are cryptoclowns
Apparently this is about interest rates and bond valuation. Nothing to do with crypto. Banks can loan far more than they actually have so will never be able to cover all their deposits.
Could we please have basic banking services through USPS, who have remit to provide these if Congress would act? That would allow most Americans to have their everyday banking needs covered cheaply and without the risks that profit driven banks impose. Regulation could also safeguard transactional and payroll funds in any bank. There’s a downside to bailing out above $250K. Widespread failures would force govt to act and prevent more of these in the future. We need much simpler banking that is reliable and not destabilizing. Govt has learned little from 1929 or 2008.
USPS use to have basic banking services but Congress screwed them over. John Oliver covered the topic a year or so.
The speculative financial institutions fight regulations, but then they cause or participate in this panic or frankly potentially manipulated behaviors.
👏🏻👏🏻👏🏻
Investors should never be bailed out. Investing is a gamble. If you win then good for you but if you lose you don’t get our tax money to bail you out to go on and make more bad decisions.
This isn’t a bailout.
Investing is a gamble. period.
Wtf is the fed? How is there no oversight? Is it the fourth branch of gov but without checks and balances?
Something about Dodd Frank comes to mind...
We do guarantee depositor money, called FDIC insurance up to $250,000.
Story repits itself, someone got fat with all that money.
Why even have rules if the government breaks them every single time it deals with corporations and wealth people?? They knew of the $250k cap BEFORE this and didn't do what you suggested. Truth is you have over $250k in your business accounts and would hate to lose your money. But capitalism is capitalism...
Thats my problem here... So they are saying the insurance limit is meaningless and should always be meaningless.
So is this related to the stocks drop from company's like Hasbro?
Why am I imagining a scene out of It's a Wonderful Life just without the neighbors bringing cash to drop in a hat🤷🏽♂️