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Navigating Banking Regulations and Risks
This chapter examines the consequences of government actions post-Silicon Valley Bank crisis, focusing on deposit insurance and depositor behavior shifts toward larger banks. It critiques the regulatory environment for smaller banks in the U.S. compared to Europe, highlighting risks stemming from under-regulation and funding management issues. Additionally, the discussion emphasizes the delicate balance of collateral value in the financial system, especially amidst rising interest rates and mismanaged risks that could spark systemic crises.