Silicon Valley Bank implosion
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Bloomberg reported that the issue is from US bonds losing value significantly due to inflation, that is impacting everyone who holds US bonds, and particularly smaller regional banks. If you look at the Dow Jones index of regional banks it is down 30% from when Biden took office and down more than 40% from its high.
This bank going bust has the potential to put about a third of the start ups it has accounts with out of business.
Also, the majority of the holdings at the bank were not insured as FDIC insurance has a limit to how much they insure.
What you are looking at is the Lehman bros moment that we had in 2008. They may lie and give bogus claims for a few days or weeks, but in the end the fact cannot be disputed, we will have a run on the banks in the US.
Think of US bonds as the engine block of the banking system. It is cracked and the car is leaking oil badly and has a big black cloud of smoke.
This bank going bust has the potential to put about a third of the start ups it has accounts with out of business.
Also, the majority of the holdings at the bank were not insured as FDIC insurance has a limit to how much they insure.
What you are looking at is the Lehman bros moment that we had in 2008. They may lie and give bogus claims for a few days or weeks, but in the end the fact cannot be disputed, we will have a run on the banks in the US.
Think of US bonds as the engine block of the banking system. It is cracked and the car is leaking oil badly and has a big black cloud of smoke.
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