Best-selling author Jim Rickards (@JamesGRickards) returns to the podcast for the third time to share his views on the collapse of Silicon Valley Bank and why the intervention — especially the Federal Reserve’s new emergency lending program, the Bank Term Funding Program — is the biggest bailout in history.
Rickards is a New York Times bestselling author of Currency Wars: The Making of the Next Global Crisis and several other best-sellers, including The New Great Depression, Aftermath, The Road to Ruin, Death of Money, The New Case for Gold, and his newest book Sold Out: How Broken Supply Chains, Surging Inflation, and Political Instability Will Sink the Global Economy.
An investment advisor, lawyer, inventor, and economist, Rickards has held senior positions at Citibank, Long-Term Capital Management, and Caxton Associates. He is also the Editor of Strategic Intelligence, a widely-read financial newsletter.
0:00 Intro
1:00 Reaction to SVB, Signature Bank failures
1:54 The mistake Silicon Valley Bank made
4:12 Bond Math 101
4:45 The Fed is between a rock and a hard place
4:52 Huge unrealized losses on the bond portfolio at SVB
6:35 There already was leakage
9:33 Friday’s press release from the FDIC
12:50 Global ripple effects of SVB failure
14:50 Other banks had similar problems
17:08 Biggest bailout in history
23:00 Executive stock sales
24:11 There would likely have been lines at banks
25:00 The biggest crybabies were the billionaires
26:15 The banking system is effectively nationalized
32:00 This was risk management 101
39:46 The Volcker mistake
40:50 Inflation
42:30 You’ll see the Fed expanding the balance sheet
43:30 Name your poison
44:10 25bps at the next Fed meeting is the most likely scenario
44:55 This is the no-drama Fed
45:45 ECB
46:10 It’s a global economy
47:00 Panics have two stages
47:30 Credit Suisse
52:10 A road to ruin
54:35 Each bailout was bigger than the one before
55:30 A front based on confidence
58:30 Deteriorating trust in institutions
1:07:27 Gold
