The Ben Shapiro Show Ep. 1686 - Is The Economy About To Melt Down?
Mar 13, 2023
The collapse of Silicon Valley Bank raises alarms about a potential banking crisis, prompting discussions on federal mismanagement and possible bailouts. Increasing interest rates are eroding bond values, threatening banking stability amid rising inflation. The podcast draws parallels between today’s financial struggles and the 2008 crisis, emphasizing moral hazard in risky investments by large banks. The Oscars' focus on diversity gets critiqued, alongside geopolitical tensions involving China, leading to a thought-provoking debate on personal fulfillment and societal expectations.
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SVB and Signature Bank Collapse
- Silicon Valley Bank (SVB) collapsed, the second largest bank failure in US history.
- Signature Bank also failed, raising concerns about a systemic banking meltdown.
Moral Hazard of Bailouts
- The government faces the dilemma of bailing out depositors to prevent systemic panic versus creating moral hazard.
- Repeated bailouts encourage risky behavior by banks and depositors.
Depositors Bailed Out, Bank Not Saved
- The government will bail out SVB depositors, but not the bank itself or its unsecured creditors and shareholders.
- This raises questions about the government's role in subsidizing bank investments and potential moral hazard.
