Silicon Valley Bank (SVB) has become the center of attention after its collapse prompted the U.S. Federal Deposit Insurance Corporation (FDIC) to shut the bank down on Friday. It was the largest U.S. bank failure since 2008, and various alleged catalysts have been pointed to. Some believe venture capitalists caused a bank run, while others blame the U.S. Federal Reserve’s rate hikes. Economist and gold bug Peter Schiff said on Friday that the U.S. banking system would experience more trouble ahead. He and several speculators believe that these financial institutions hold mountains of long-term treasuries.
Calls for SVB Intervention as Market Observers Predict Larger Financial Collapse in the U.S.
Over the past week, two U.S. banking institutions, Silvergate Bank and Silicon Valley Bank (SVB) failed. SVB’s collapse was the largest banking failure since Washington Mutual (Wamu) in 2008, which was blamed on expanding branches too quickly and holding massive amounts of subprime mortgages lent to so-called unqualified buyers.
Before its collapse, Wamu held $188.3 billion in deposits, while SVB is estimated to have lost around $175.4 billion in deposits. However, while SVB’s deposits at the end of December 2022 were $175.4 billion, customers attempted to remove $42 billion on Thursday alone. It’s safe to say that SVB’s demise was a lot faster than Wamu’s collapse at the end of 2008.
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Author: Jamie Redman
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