Top Line
Americans can “breathe easy,” President Joe Biden said Monday morning, after his administration rolled out measures to ensure uninsured customers at Silicon Valley Bank and Signature Bank, Both failed. The weekend of the biggest bank falls since the Great Recession.
Biden speaks at the White House on Monday.
important facts
“We will do whatever is necessary to prove that our banking system is safe,” Biden said.
“I’m going to ask Congress and banking regulators to strengthen the rules for banks so that this type of bank failure is less likely to happen again,” Biden said.
Biden reiterated that taxpayers would not foot the bill directly for a plan funded by federal banking fees.
Biden previously threw his weight behind a plan by US banking and financial regulators to return all deposits series In Sunday tweets, the Treasury, Federal Reserve and Federal Deposit Insurance Corporation laid out their “direction” to craft a plan that would protect “workers, small businesses, taxpayers and our financial system” alike.
Not all experts agree with the initiative to rescue uninsured depositors, including Peter Schiff, an economist at Euro Pacific Capital called The plan is a “mistake” that will lead to “even greater instability in the banking system and bigger losses in the future” and the collapse of “many more” banks in the future.
Stocks fell about 1% during Biden’s speech, with the Dow Jones Industrial Average, the S&P 500 and the tech-heavy Nasdaq falling, including bank shares.
main background
Financial regulators shut down Santa Clara-based Silicon Valley Bank on Friday, shortly after it ran on deposits and plunged its share price after the company failed to allay investor fears. According to Biden, all the executives of Silicon Valley Bank and Signature Bank will be fired. The Silicon Valley bank failure is the largest bank closure since 2008 and the second largest in US history. Regulators also shuttered New York-based Signature Bank on Sunday, while crypto-focused Silvergate closed its doors on Wednesday after it failed to recover from the effects of the collapse of its one-time client FTX, which discredited former is a crypto exchange founded by billionaire Sam. Bankman-Fried.
important quotes
"That's how capitalism works," Biden said Monday of equity stakeholders in failing banks.
chief critic
Sen. Elizabeth Warren (D-Mass.) took issue with Biden's oversight of pseudo-bailouts to protect "billion-dollar crypto firms" in a Monday column. new York Timeswriting: "Regulators have said that banks, rather than taxpayers, will bear the cost of the federal backstop needed to protect deposits. We'll see if that's true."
amazing facts
The yield on 2-year US Treasury notes fell to a six-month low on Monday morning as bond market prices rose on the prospect that the Federal Reserve would hold off on raising interest rates.
FDIC will protect all Silicon Valley bank deposits after sudden collapse, Treasury saysforbes,
What to know about the collapse of Silicon Valley Bank - the biggest bank failure since 2008forbes,
Credit: www.forbes.com /