A few years earlier, in the early 90s, Westpac almost came asunder after a meltdown in the value of its commercial property portfolio.
The global financial crisis was created by lax oversight of a deregulated banking system and made worse by the US Federal Reserve's decision to allow Lehman Brothers to collapse. Signature Bank was heavily involved in crypto loans while SVB focused on technology entrepreneurs, enterprises and investors. As the deposit withdrawals accelerated, neither bank had adequate reserves to meet them.
Junior banks falter as money flows to senior banks, some siphoned off to bitcoin, hence the rise. Senior banks gobble up the juniors and with it the assets they currently hold. Interest rates drop, economy rebounds in the senior banks own much more of the world. Pattern repeats.
If we look hard ENOUGH at the right hand side of the graph we actually see the uptick. The return of QE. The US fed has done next to no QT and already weakened if not given up on it and therefore it's inflation fight.
Well its really just the start of things. Its all going down eventually. Might not be today, might not be next week. But the USA dollar is totally shot to pieces...the debt levels are just impossible to repay.
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Regulatory protection for depositors at banks ‘necessary’ after Silicon Valley Bank runUniversity of Sydney Head of Business and Finance Prof. Eliza Wu says regulatory protection for depositors at banks is “necessary” as the traditional banking model indicates bank “runs” are likely to occur. “Regulatory protection is necessary because – the vulnerability with the traditional banking model with the maturity transformation they are engaged in with their unique role in our financial system is that there are likely to be runs,” Ms Wu told Sky News host Ross Greenwood. “Trust evaporates very quickly within financial systems and we’ve seen that happen over and over again – throughout history. “So then it’s important to have this base level of protection in place to ensure depositors feel sufficiently safe with parking their funds with banks so they are able to engage in this important function – throughout the economy.” is there not a $250k guarantee on deposits already or was that taken away? Bank runs!! 🤣 The banks have closed half the banks and ATMs. I guess we will have to transfer funds to Bitcoin BitcoinCash through internet banking!
Source: SkyNewsAust - 🏆 7. / 78 Read more »
Silicon Valley Bank ‘exposed themselves’ loaning money to ‘cash poor’ tech start-upsUniversity of Sydney Head of Business and Finance Prof. Eliza Wu says Silicon Valley Bank “exposed themselves” to difficulty gaining funds back by handing out loans to start-up tech companies which are typically “cash poor”. “In the case of Silicon Valley Bank they’ve exposed themselves to a lot of loans made to start-up tech companies – typically cash poor so it’s very hard to be able to get funds back when you need to,” Ms Wu told Sky News host Ross Greenwood. “Especially when you’ve got large investors that are withdrawing funds from the financial institution.”
Source: SkyNewsAust - 🏆 7. / 78 Read more »