Navigating Banking Vulnerabilities

This chapter explores the systemic vulnerabilities and financial missteps of Silicon Valley Bank, emphasizing the failures in risk management and deposit insurance practices. It critiques the reliance on uninsured deposits and the political barriers to reform in the banking sector, while advocating for a rethinking of the banking system's role in credit allocation. The conversation also discusses the potential impact of central bank digital currencies and the implications of fully insuring deposits on monetary policy.