How much longer will America’s regional banks hold up?
What kind of story is unfolding in the banking system? At first glance it would appear to be a tragic drama. In the past fortnight, four banks have met their end: two crypto lenders, the dominant bank in Silicon Valley and most recently a global systemically important bank. There have been 11th-hour interventions to protect […]
America’s banks are missing hundreds of billions of dollars
It is easy to understand how money gets destroyed in a traditional bank run. Picture the men in top hats yelling at clerks in “Mary Poppins”. The crowds want their cash and bank tellers are trying to provide it. But when customers flee, staff cannot satisfy all comers before the institution topples. The remaining debts […]
America’s government steps in to protect depositors at Silicon Valley Bank
WHEN ONE bank collapses, the panicked question is often “who’s next?” Other financial institutions can end up exposed because of connections to the collapsed institution, because they employ similar business models or simply because investor sentiment sours. Depositors face losses if their funds are too large to be covered by deposit-insurance schemes. These were precisely […]