Bank failures are likely to continue increasing due to rising interest rates, as it causes their commercial paper and treasuries to become devalued. To prevent a severe economic downturn, it is necessary to implement a freeze on interest rates. Simultaneously, the White House should support the industry in boosting gas and oil production to lower fuel prices. The anti-oil stance only contributes to higher energy costs, leading to inflation throughout the economy. By reducing interest rates, tightening the money supply, cutting government expenditures, and increasing the availability of affordable fuel, inflation will decrease, and the economy will thrive. Unfortunately, various conflicting agendas make it unlikely for all these measures to be implemented, resulting in a recession and persistent inflation.

We don't share their profits, we shouldn't share their risks.

I always find it hilarious that when a Bank is profitable, the management gets all the credit and shareholders reap the benefits, but when it collapses due to management incompetence and bad investments, it immediately looks out for a bailout from the Government. What kind of other Capitalist business behaves likes this? None! The profits are private but the losses are for the Public.

This recession is most likely the result of an external factor. For the first time in decades, the United States is losing its clout as a federal reserve currency. They don't have any more economies to use to control inflation, and less money is being spent on stock and oil trading than in the past. They all lend support to the idea that a new multilateral world order is in the works.

Jail time for the bankers. No bail out.

The main thing to investigate is the bank giving out huge bonuses a day before it all went down. and the top management selling stock!!!!

That’s fine… don’t bail them out… but certainly go after any executives who took bonuses before the shutdown… I’m interested in seeing what they do to investigate what (if any) fraud and embezzlement may have taken place.

Government can't keep capitalizing profits but socializing the losses, there should be penalties for reckless actions

No to bail outs. If the bank is that important it should be nationalised without compensation. A bail out sends the wrong message that big companies can do highly risky investments and will be saved by the government.

Absolutely no to a bailout. As average Americans suffer under the weight of inflation, the government had better not send the message that if you over leveraged yourself, we'll bail you out, but only if you're rich. Less than 3% of that bank had deposits under $250K. This is the point of rising interest rates - to bring the pain. It already hurts average people more than the very wealthy. No need to worsen that.

bailout only goes to board members, not account holders

As a Software Engineer, who earns a sweet amount of cash at the end of the month (nothing too special, since I work from Portugal), I do hope for no bailout. Most startups suffer from really really poor management, just as this bank, it appears. It is about time message gets across that when you enter business you stand to win as much as you stand to lose. Public money should not be the default way of saving banks or big businesses of any kind. Especially, those that in good years profit well beyond 6, 7 and, 8 figures. Back when I studied economics, the rule of thumb was do not start a business, unless you have enough runway to sustain yourself for at least two years and when you are profiting, make sure that remains true. Nowadays, it appears companies can do a little fart and all of a sudden they overhire, then things like layoffs and defaults happen.

We need to revamp the banking system. Its out of control.

Yellen is right for once, absolutely no bailout, either let a private party snap it up or liquidate it and let customers get 94 cents on their dollar; all employees and executives should be sued to give back bonuses and stock sales and those proceeds returned to customers. This isn’t hard.

Let the bank fail.

Capitalism for the poor and socialism for the rich. Western financial system in a nutshell.

No way, inflation is already incredibly high just for food essentials.

No bailouts for venture capital or tech companies none

No more bailouts please. Bailouts are ruining our financial system. Especially bailouts to the big wealthy corporations.

Let it burn!!

Curious. This banks is not like other banks. When companies get funded they almost invariably open SVB accounts and the VCs fund them through the accounts. A large number of employee payrolls, vendors, partners, customers, etc. will not get paid. Even office rents can’t be paid. Most companies I know have payrolls exceeding the FDIC basic insurance. That means car payments, new car purchases, home remodels/purchases, apt rents, eating out, etc. will be on hold.

Just don’t use Taxpayers’ money to bail out those rich folks in the Silicon Valley. Let them burn and learn.

Keep listening to Jim Cramer for all your financial advice… 🤣😂🤣😂🤣

NO BAILOUT.

People should do more research into the solvability of banks before they trust it with their money.

The wine, biotech and tech industries are all impacted by this. I don't want to see a bailout - I want to see those CXOs and the board in jail for this. Thankfully a lot of companies who had their money in SVB are getting help from others, which is great.

So the people get to spend more on tax to be used to bail out a bank. Ill remember this next time banks turn me down for a loan.

Adani to Hindenburg: he dude how you noticed me and missed companies on your own land.

Thank god. Let it fail. Stop letting these companies privatize profits and socialize losses. If they did, it incentivises banks/companies to be riskier than normal with little exposure since they know the government will step in at the last moment to save them.

No bailout period.

Even the FOOD BANKS are going broke!

"I want to reassure people" *proceeds to slowly die inside

They made it sound a bit like the companies should have done a better job at diversifying and were financially irresponsible, so they may have had this coming. As a software developer, I may stand to lose the most from this, but I don’t think I’d want to work for a startup if I knew its capital was managed by a bank that was doomed to failure to begin with.

Why would a private company get bailed out by a government. Do they say when they are making millions and avoiding paying tax there you go government thats for you as you are not doing too well.

Never bail out a company that shareholders sold stocks before foreclosure. NEVER

The problem is that with interest rate increases, American banks do not want to pay interest on depositor accounts. That is how greedy and off the rails the financial system is. So this bank just went under as a tactic to try and get the fed reserve to lower interest rates to 0% which would cause an inflation explosion and throwing all of that pain on average American workers and the middle class. It also means it is a systemic problem across all banks because if paying a measly 5% interest on deposits causes these banks to become insolvent, the entire financial system is unsound and defective. This is what free money socialism for banks and Wall Street in the last 15 years caused. The fix is not to bail these banks out. Just let them collapse. Americans will feel the pain either way. There is no easy fix, but the best fix is to purge all the banks that are so greedy they want to scheme any method to not pay interest on depositor's money.

this media news won't say that this is contagious

This situation shows There is weaknesses in this economy.

NO BAILOUTS!!!

If these tech companies suffer from cash flow problems, think about the impact on tax revenue in poor Ireland and the Cayman Islands.

1:01 I thought that was a mugshot

So many small medium techs go belly up, no surprise. Their products are getting quite redundant and actually not needed.

The structural separation between investment banking and commercial banking is crucial to US economic stability. Investment banking by its nature is risky. The entire money supply should not be endangered by that risk, as actually did occur in 2007-08. As Senator Romney pointed out, backstopping with taxpayers' money such risky institutions actually encourages further risky behavior. It should not be done. Instead, let other investing institutions bid for the assets that remain. And any chicanery by the company officers that pushed SVB toward collapse should be prosecuted and their ill-gotten gain confiscated.

Think the total of companies that have a dept at this bank is higher than the total of assets, that companies stored there. Especially in the US: Everything on credit! Rule 1 in Business: Spread your risks, so never bank at only 1 bank.

Silly con valley Bank 😭

Never underestimate the incompetence of bank management - size does not matter - and as you heard from many Silicon Valley JVs/CEOs - never underestimate the ignorance and incompetence of corporate management. As a corporate financial advisor, I warn about this scenario (one of many) everyday - It is usually ignored.

And guess what? Theyve backtracked and now going to bail them out.

That aged well...privatize the profits, socialize the losses...it's a big club and the media is part of it

It's not the bank getting rescued but the companies that can't pull their money. The companies can't make payroll, pay vendors, pay their tax bills, pay stock dividends, and more because they don't have access to their funds. This issue actually affects the everyday person on a very large scale. The bank isn't getting bailed out per se; the companies whose accts had 100 million USD deposited- only $250K USD of it is insured. They could face possible collapse if the bank doesn't either get "bailed" or obtain a buyer.

Good. Deregulation means deregulation, and if companies want to park their money in a bank that lobbied to be deregulated from the Dodd Franks Act, they need to face the consequences.

SVB is not Too Big To Fail.

This is about to go worldwide, so sad!

Weird. At one point in time, big business was too big to fail.

Isnt it incorrect to refer to the money lost as "investor" money? Didnt they use depositor money from the commercial side?

Solutions? Why would you put all YOUR EGGS IN ONE BASKET - no rocket science, after the other major collapse.

@3:37 Wrong. Why is this guest still noting the FDIC insurance limit from 1980? Back in 2008, the FDIC changed its insurance limit from $100,000 to $250,000. That would be approximately 200,000 pounds, not 85,000.

*It's not failure,it's success.* 🤑🤑

do not spent money unless you have it, that goes for people as well as governments , If you don't have the money don't spend., So in that way you do not need banks

The bank gave not enough lobby money.

Good, you cannot privatize the successes and socialize the losses

When the Fed crashes the value of treasuries and mortgages by 30%, you'd think they would raise the capital requirements. This is blood in the water for anybody looking for shorts or volatility, and why so many talking heads are saying to pull your money.

I'm sure the director of the bank still gets a golden handshake after going bust.

Signature bank now collapsed as well

GOOD they should NEVER bail out banks that get themselves into these problems. Go after the CEO's wealth to get part of the money back as well.

Read somewhere the average employee salary was $250,000. Bet those were some sweet good bye bonuses passed out on Friday.

No bailout is the only way to be. Send the message bad investing by financial institutions will no long be rewarded. Also, a large problem is that SVB has so many tech companies as depositors, those companies now are financially unstable. This makes them very vulnerable and more likely be bought cheap by the likes of Apple, Facebook, Musk, etc.. Which wont be good for consumers.

I don t know how you can put money in the bank and then when you need them they are gone. Why should i keep money in the bank with negligeble interest rate. I want a bank to give me the fed proposed interest rate

No bailout for SVB?

Not big enough to be bailed out. Let JP and the rest pick up the scraps.

Of course it's a California bank and it related to tech industry

Everyone needs more than their salary to be financial stable. The best thing to do with your money is to invest it rightly, because money left for saving always end up used with no returns.

It isn’t unusual a bank investing in highly speculative and risky startups might get out ahead of their skiis. It was eventual one or more of the associated institutions would go belly-up.

No bail outs unless someone going jail for fraud this time

What about Grass Valley Bank?

2008 starting all over again...

👉 Start ups, Skid Row welcomes you !

We've heard that before.

Monday Bank of America and Wells Fargo and Charles Schwab are the ones to watch for when the markets open.

It’s different this time 🤣🤣

One reason why individuals may choose to keep their money out of banks is to avoid the risks associated with banking institutions. The 2008 financial crisis, which led to the collapse of many large financial institutions, exposed the risks involved with the banking system. Banks can face a variety of risks, including credit risk, interest rate risk, operational risk, and liquidity risk. These risks can result in the loss of depositors' funds or even the bank's failure. Some individuals may prefer to keep their money in other assets such as gold, real estate, or stocks as a way to diversify their portfolio and minimize their exposure to banking risks. These assets may have their own risks, but they may be seen as less risky than keeping all of their funds in a bank account. Additionally, some individuals may choose to hold cash, which carries its own risks such as inflation, but may offer more liquidity and control over their funds than a bank account.

Never put all the eggs in one basket.

WOW.

1:48 🙄

How does this happen every 10 years and no one seems to learn a lesson from this? Clearly greed trumps common sense

Leastwise not till Monday morning.

Anddddd it's gone!

They say if the banks crash the fdic insurance will send you a check well if theres no banks who's going to cash that check, get 99% of your money out of the bank now.

Scary

The question that needs IMMEDIATE answer concerns whether this failure is isolated with this bank, or whether the failure reflects something systemic in the American banking industry. Everyone who knows any history sees how runs on banks can spread irrationally fast like wildfire - including to banks that are properly managed. Such runs can have devastating effects on even strong economies. We must hope that the feds are taking this with required seriousness. Update edit: US President today announced 1. Takeover of SVB. 2. Firing of bank management 3. Federal guarantee of all deposits, and 4. Declining to protect bank investors. These reasonably swift measures indicate that the administration understands the consequences of bank runs and is acting fast to prevent them. There are still other, lesser risks ahead, but the major risk has been managed with appropriate speed. Other venture capital banks should be watched closely ahead.

stock price for both, SVB And Signature Bank, have been falling for all 2022, so I wouldn't call it sudden

In from the States. Monday Morning comming Down. Humpty Dumpty.

You know it is pretty serious when you hear it from an expert with a British accent.

Old man Potter is buying SVG shares for 50 cents on the dollar!

This is gonna be huge!!

👏👏

I thought each type of account will give the owner $250K FDIC insurance?

SVP has not lost depositor's money. Nearly all customer's money is in a cash account. The bank now holds Treasury Bonds for that cash, and they never go below a dollar. They have a liquidity problem and are now selling those bonds to raise cash again. The only loss is the share price of the bank, and it's own assets.

Since 2020 there's ZERO fractional reserve in the USA. That's right, 0%. No bank has liquidity if people chose to withdraw cash.

no bail out.

LOL not even a day later she decided to bail em out