The Death of Silicon Valley Bank
Finshots Daily
00:00
The Perfect Storm for Long Term Bonds
The US Federal Reserve finally raised interest rates and it raised rates quite quickly. The prices of SVBs assets fell significantly, the bank was looking at losses on its books. But what's weirder is that a long term bond is more sensitive to this inverse relationship. So if they buy it now, they will benefit from the discount and also get the 2% interest rate.
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Transcript
