The idea that finance is an arm of the state is back, and global banking is likely to be reshaped by it. I think if Silicon Valley Bank had been based in Oklahoma, I think governments might have taken a very different view. There is no free market world in which it would make sense to allow UBS, the biggest Swiss bank, to take over the second biggest Swiss bank. If your main priority is to keep Swiss finance Swiss, it makes absolute sense.
A lot has been said about the collapse of Silicon Valley Bank and Credit Suisse. But one important thing revealed by those closely scrutinized failures has largely gone unnoticed: the changing relationship between governments and banks.
Bloomberg Editor-In-Chief John Micklethwait joins this episode to talk about how the idea that finance is an arm of the state is back–and why that will have far-reaching consequences for the way the world works.
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