The Daily Why the Banking Crisis Isn’t Over Yet
45 snips
Mar 17, 2023 
This week’s guest, Emily Flitter, a finance correspondent for The New York Times, dives into the ongoing banking crisis and its shocking impact on institutions like Silicon Valley Bank. She discusses the panic that led to $42 billion in withdrawals and the government’s rescue efforts. With regional banks feeling the tremors, Emily explores the uncertainties around investor confidence and the challenges faced by entities like Credit Suisse. Tune in for insights into how interest rates and regulatory weaknesses are reshaping the banking landscape.
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Interest Rate Fears and Market Jitters
- Regional bank stocks plummeted due to investor fears about interest rate risk management, mirroring Silicon Valley Bank's issues.
- The government's reassurance that everything was fine backfired, as markets reacted negatively to the perceived inconsistency.
Questioning the Government's Response
- The Biden administration's decision to backstop all Silicon Valley Bank depositors sparked questions.
- If the bank's failure wasn't a systemic risk, why the intervention, and what message does this send?
Silicon Valley Bank's Costly Decision
- Silicon Valley Bank's decision to sell off its securities portfolio at a loss, advised by Goldman Sachs, was costly.
- This highlighted the bank's mismanagement and raised concerns about the advice they received.