There was an uptick in withdrawals. And there was a decrease in consumer confidence. Not saying it is right or wrong but that is why it was done.
Silicon Valley Bank
- Thread starter RxCowboy
- Start date
jobob85
Bent Member
I’m not sure I considered depositors as investors. They are assuming minimal risk/reward for anything over the insured limits so…
Why the FDIC got involved past their insurance limits…To make a show of stability? Or to gain more power and control?
Or both.
So the administration could gain more power and control?
jobob85
Bent Member
I think the FDIC is on the power trip.
I could buy that. The question is why? The answer is, the Dems want to nationalize the banking system. This gets us one step closer to it.
There’s the partisanship I was waiting for.
What party do I belong to?
Don’t really care which party you belong to. It doesn’t seem like you went into this thread asking a genuine question. you wanted confirmation of your already formed opinion that the dems are using this to nationalize banks.
That is what the answers were too
No, I asked a genuine question wanting a real explanation. What I got was disingenuous partisanship, "it's Trump's fault" with nothing but a vague article to back it up. Somehow rule changes that affected mostly community banks caused the collapse of an investment bank. The feds stepped in to save an investment bank to somehow stop runs on community banks, or to somehow restore confidence in community bank deposits the vast majority of which are FDIC insured. So I thought I'd play along. I mean, you guys could have just admitted you didn't know. The closest we got to an actual answer was likely "more control, more power", which leads us to the Dems really do want to nationalize the banking system, and this is a big step towards it. This is something we did actually know because Elizabeth Warren has been banging that drum since before she took office (notice the pun, Warren "banging that drum").
P.S. I am no longer a Republican. I quit the party after the Jan 6 BS. I do not want to be associated with that.
I posted an article showing the rollback of regulations. You refuse to believe that the failed banks were part of the rollback. Can’t really have a discussion if you can’t accept something that basic.
One of the thoughts is that the potential failure of the banks would have been caught with the added stress test. Stress test were reduced under the 2018 rollback. If it would have been caught is debatable.
nothing from me was partnership much less disingenuous partnership.
jobob85
Bent Member
Assuming your answer is the only answer is a bold move. Banks are not FDIC insured, their depositors are. Here is a good article on the subject
How Washington Decided to Rescue Silicon Valley Bank’s Depositors
Officials were initially unsure about the need for the measures they eventually announced to shore up the financial system, but changed their minds quickly.
The odds of a national banking system are at or below zero, it is simply a nonstarter.
You posted an article that discussed rolling back regulations that mainly affected apples. The bank that failed was an orange. You didn’t show me how the rolled back regulations affected oranges. If you care to explain I will listen. If you can’t acknowledge the difference between community banks and investment banks then why are you even in this conversation?
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I think you miss read the article. The article talked about regulations that affected both apples and oranges. It was just a comment by one person in the article that mentioned how it would help apples. The regulations did not designate whether a bank was a community bank or an investment bank. Just how much they had in asset level.
Also keep in mind that the money used to save the people that had money in this bank did not come from taxpayers. It came from a fund setup by fees from other banks. So it is more of the industry helping to solve this bank with the guidance from the government. As stated this is not really a partisan issue, there are more than enough of those so we don't need to make ones that really aren't into one.
Again no where in the article does it say the 2018 changes are limited to "community" banks. Everyone sees that but you.
Did a quick look here is an article that doesn't use the word "community"
The facts on Trump's 2018 loosening of regulations on banks like SVB - ABC17NEWS
By Daniel Dale, CNN After Silicon Valley Bank collapsed late last week following a run on the bank, Sen. Bernie Sanders of Vermont argued that the culprit was clear: an “absurd” 2018 law, signed by then-President Donald Trump, that rolled back regulations on banks of SVB’s size. President Joe...
edit: I took some parts out. I want to be civil.
Thanks for attempting to bring this back into a legit conversation in lieu of the red herring we've been working on so far.
jobob85
Bent Member
I would not use Berny as a source for financial analysis. The rollback may have played a part but the real causation is rising interest rates and how banks solvency is measured. Carring long term bonds at face value when interest rates have doubled was the biggest problem SVB suffered. I think we will see new reporting rules to report those long term assets a CFMV instead of Face ValueAgain no where in the article does it say the 2018 changes are limited to "community" banks. Everyone sees that but you.
Did a quick look here is an article that doesn't use the word "community"
The facts on Trump's 2018 loosening of regulations on banks like SVB - ABC17NEWS
By Daniel Dale, CNN After Silicon Valley Bank collapsed late last week following a run on the bank, Sen. Bernie Sanders of Vermont argued that the culprit was clear: an “absurd” 2018 law, signed by then-President Donald Trump, that rolled back regulations on banks of SVB’s size. President Joe...abc17news.com
edit: I took some parts out. I want to be civil.
I am not going to argue with you on that about Berny. I was using that article to show @RxCowboy that SVB was one of the banks that the regulations were rolled back in 2018. He refuses to accept that and has been nothing but rude and condescending to me about it.
I am sure you know more about this and I will defer to you. My point was that if the rollbacks had not happened there may have been a chance that the SVB failure would have been caught earlier on and possibly prevented. That is at least an argument that I have read. I would love to hear your thoughts on that.
jobob85
Bent Member
I won't claim to be an expert here but, I have been educating myself on all the issues involved. My family is large, split and politically stubborn. I find that most issues, like this one, have little basis in politics except to provide wrongly applied correlations and fodder. So, to get any real idea I have to ignore family and search for the facts.
I will pose a couple of things that are intriguing to the overall discussion. Here is a link to bank failures, you can look at them by year and follow them back to Dodd Frank of 2008 through 2018 rollback and beyond. https://www.fdic.gov/resources/resolutions/bank-failures/failed-bank-list/
Secondly, if you were wanting to Nationalize the banking system why would you bring the FDIC, the Fedreal Reserve and Banking CEO's together to help resolve this situation? Wouldn't letting SVB flame out and take some others with it give you more leverage to step in and institute a National Bank?
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