VOA: From Wine Country to London, Bank’s Failure Shakes Worldwide
Over 95% of Silicon Valley Bank’s deposits are not insured by the FDIC (due to being over the $250,000 limit)
That is over $160 billion in uninsured customer deposits
About half of all venture capital-funded startups in the US are customers of SVB
That’s 65,000 startups
— Andrew Lokenauth (@FluentInFinance) March 11, 2023
Voice of America reported the following:
From Wine Country to London, Bank’s Failure Shakes Worldwide
March 12, 2023
It was called Silicon Valley Bank, but its collapse is causing shockwaves around the world. From winemakers in California to startups across the Atlantic Ocean, companies are scrambling to figure out how to manage their finances after their bank suddenly shut down Friday. The meltdown means distress not only for businesses but also for all their workers whose paychecks may get tied up in the chaos.
California Gov. Gavin Newsom said Saturday that he’s talking with the White House to help “stabilize the situation as quickly as possible, to protect jobs, people’s livelihoods, and the entire innovation ecosystem that has served as a tent pole for our economy.”
U.S. customers with less than $250,000 in the bank can count on insurance provided by the Federal Deposit Insurance Corp. Regulators are trying to find a buyer for the bank in hopes customers with more than that can be made whole.
That includes customers like Circle, a big player in the cryptocurrency industry. It said it has about $3.3 billion of the roughly $40 billion in reserves for its USDC coin at SVB.
That caused USD Coin’s value, which tries to stay firmly at $1, to briefly plunge below 87 cents Saturday. It later rose back above 97 cents, according to CoinDesk.
Across the Atlantic, startup companies woke up Saturday to find SVB’s U.K. business will stop making payments or accepting deposits. The Bank of England said late Friday that it will put Silicon Valley Bank UK in its insolvency procedure, which will pay out eligible depositors up to 170,000 British pounds ($204,544) for joint accounts “as quickly as possible.”
“We know that there are a large number of startups and investors in the ecosystem who have significant exposure to SVB UK and will be very concerned,” Dom Hallas, executive director of Coadec, which represents British startups, said on Twitter. He cited “concern and panic.”
The Bank of England said SVB UK’s assets would be sold to pay creditors. It’s not just startups feeling the pain. The bank’s collapse is having an effect on another important California industry: fine wines. It’s been an influential lender to vineyards since the 1990s. https://www.voanews.com/a/from-wine-country-to-london-bank-s-failure-shakes-worldwide/7001075.html
CNN reported:
Takeaways from America’s second-largest bank failure
Silicon Valley Bank’s 48-hour collapse led to the second-largest failure of a financial institution in US history.
SVB was one of America’s 20 largest commercial banks and is now under the control of the US Federal Deposit Insurance Corporation after it became unable to pay back customers who withdrew their deposits. …
SVB was a massive bank
Founded in 1983, Silicon Valley Bank provided financing for almost half of US venture-backed technology and health care companies. They have been hurt by higher interest rates and dwindling venture capital. …
High interest rates led to its demise
To combat rampant inflation, the central bank has been aggressively raising interest rates since 2022. It made borrowing for businesses and individuals more expensive to cool the economy down.
When interest rates were near historical lows, the banks bought up on long-dated, seemingly low-risk Treasuries. But as rates rose, the value of those assets has fallen, leaving them sitting on unrealized losses.
High rates significantly constrained tech companies, which undercut the value of tech stocks and made it difficult to raise funds.
Faced with higher interest rates, loss of IPOs and a funding drought, SVB’s clients began pulling money out of the bank.
“The higher rates have also lowered the value of their treasury and other securities which SVB needed to pay depositors,” Moody’s chief economist Mark Zandi said. “All of this set off the run on their deposits that forced the FDIC to takeover SVB.” …
There’s a lot to lose
US customers held at least $151.5 billion in uninsured deposits by the end of 2022, SVB’s latest annual report said. Foreign deposits reached at least $13.9 billion and are also uninsured. …
Tech companies are scrambling
SVB was a top lender for the startup community, whose founders now worry about getting their money out, making payroll and covering operating expenses, Catherine Thorbecke wrote. https://www.cnn.com/2023/03/11/business/svb-collapse-roundup-takeaways/index.html
The fact that higher interest rates are to blame is interesting for at least two reasons. The first is that the US Federal Reserve had them artificially low for years–there is a cost for that. The second is that last Fall, Europe began to blame the USA for causing it economic problems by raising interest rates (see ZH: A Reeling Europe Lashes Out At The Fed For “Bringing Us To A World Recession” COGwriter: Could this lead to HWA’s ‘banking crisis’?). Silicon Valley Bank is not the only organization affected by attempts to manipulate interest rates and the economy.
Now here are some other reports related to the collapse of Silicon Valley Bank:
Is SVB Just the Beginning?
Our guard should have gone rocketing up last month — when Mr. Jim Cramer recommended Silicon Valley Bank stock to his listeners.
That is because the fellow is a nearly perfect “contrarian indicator.” If he says x you can very reliably wager on y.
SVB stock was trading hands at $320 that day. Today it trades hands at $0. It has vanished from existence. …
The Federal Reserve has been hard at the business of raising interest rates since last March. 03/10/23 https://dailyreckoning.com/is-svb-just-the-beginning/
Will Silicon Valley Bank’s failing lead to a cascade of other bank failings?
After all: In the banking world the foot bone is connected to the leg bone is connected to the knee bone is connected to the thigh bone is connected to the hip bone is connected to the backbone is connected to the neck bone. …
Fox News host Tucker Carlson said Friday that the collapse of Silicon Valley Bank was similar to a “bank run” from 1929 and the collapse of the cryptocurrency exchange FTX.
“We’re starting to get a better, more precise sense of what it means when Joe Biden brags about the strongest and most equitable economic recovery in history,” Carlson, a co-founder of the Daily Caller News Foundation, said. “What it means is it could be time to buy gold and stockpile food.”
“Some of the biggest banks in this country, Wells Fargo, Bank of America, J.P. Morgan, Morgan Stanley collectively lost more than $50 billion in market value in one day. That’s quite a hit. On the other hand, those banks still exist,” Carlson added. “You can’t say that for Silicon Valley Bank. As of this morning, Silicon Valley Bank, or SVB, has gone under completely. That makes the second biggest bank failure in the history of this country.” …
Carlson noted the efforts by depositors to get their money back.
“What we have there is a 1929-style bank run and that’s not a good sign for anyone. The question is whether the people who run SVB saw it coming. The CEO, a man called Greg Becker, apparently sold more than $2 million in bank stock in the last two weeks,” Carlson said. “According to the site Unusual Whales, several other high-level employees of SVB including chief marketing officer Michelle Draper, COO Phil Cox, general counsel Michael Zucker, all sold significant amounts of stock in SVB this year.”
“Did those employees know their bank was in trouble? We don’t know. Once again, where were the regulators? Carlson asked. “They were supposed to prevent this. Once again, we don’t know. And the business press? Supposed to be telling ordinary people what’s happening with business. Apparently, nobody noticed anything.” 03/11/23 https://www.wnd.com/2023/03/tucker-carlson-reacts-2nd-biggest-bank-failure-american-history/
The wait for the next “Lehman Brothers moment” is over. On Friday, we witnessed the second biggest bank failure in U.S. history. The stunning collapse of Silicon Valley Bank is shaking the financial world to the core. As of the end of last year, the bank had 175 billion dollars in deposits, and approximately 151 billion dollars of those deposits were uninsured. In other words, a lot of wealthy individuals and large companies are in danger of being wiped out. In particular, this is being described as an “extinction level event” for tech startups, because thousands of them did their banking with SVB. I cannot even begin to describe how cataclysmic this is going to be for the tech industry as a whole. …
Of course a lot of the “experts” in the mainstream media never saw this coming.
Just last month, CNBC’s Jim Cramer was actually telling his viewers that they should buy SVB stock…
CNBC analyst Jim Cramer is once again being pilloried on social media after a clip resurfaced showing the “Mad Money” host recommending viewers buy shares of Silicon Valley Bank’s parent company, which owns the tech-driven commercial lender that swiftly collapsed on Friday.
“The ninth-best performer to date has been SVB Financial (the bank’s parent company). Don’t yawn,” Cramer told viewers during a Feb. 8 episode of “Mad Money.”
Cramer listed SVB Financial among his “biggest winners of 2023 … so far” alongside blue-chip stocks such as Meta, Tesla, Warner Bros. Discovery, and Norwegian Cruise Line.
Unfortunately, SVB’s situation is not unique. 03/10/23 http://theeconomiccollapseblog.com/2nd-biggest-bank-failure-in-u-s-history-we-found-our-enron-on-the-verge-of-a-much-bigger-collapse-than-2008/
If this spreads, Europe will blame the USA for the ensuing economic crises.
Interestingly, the late Pastor General of the old Worldwide Church of God, Herbert W. Armstrong, had a view about banking matters and European unity. Here is something he said in a sermon on July 7, 1984:
And I can see now, the event that is going to trigger the formation of the reunification in Europe; the resurrection of the medieval Holy Roman Empire that we’ve been looking forward to that is prophesied to come…
But I believe that some event is going to happen suddenly just like out a blue sky that is going to shock the whole world and is going to cause the nations in Europe to realize they must unite! … Well now I think I can see what may be the very event that is going to trigger…that is the economic situation in the world…
The whole banking structure in the United States is a network all jointed together. But not only that, one nation has to deal with other nations and imports and exports. And so they have to have a means of transforming money from one nation to another. And so the banking structure is international and interwoven…
Now when the financial structure breaks down, all civilization is going to break down…
So, an economic or banking crisis is what Herbert W. Armstrong concluded would drive Europe to unite.
And yes, Europe will unite against the USA as well as its British-descended allies.
The collapse of Silicon Valley Bank is not good for the USA.
We will see if much fallout from the failure of Silicon Valley Bank spreads to Europe.
Some items of possibly related interest may include:
Might the U.S.A. Be Gone by 2028? Could the USA be gone by the end of 2028 or earlier? There is a tradition attributed to the Hebrew prophet Elijah that humanity had 6,000 years to live before being replaced by God’s Kingdom. There are scriptures, writings in the Talmud, early Christian teachings that support this. Also, even certain Hindu writings support it. Here is a link to a related video: Is the USA prophesied to be destroyed by 2028? In Spanish: Seran los Estados Unidos Destruidos en el 2028?
Physical Preparation Scriptures for Christians. We all know the Bible prophecies famines. Should we do something? Here is a version in the Spanish language Escrituras sobre Preparación física para los Cristianos. Here is a link to a related sermon: Physical preparedness for Christians.
The Plain Truth About Gold in Prophecy. How Should a Christian View Gold? What do economists and the Bible teach about gold? Gold and silver may drop in value. Inflation/deflation? What do Christians need to know about gold and silver? Two videos of related interest may be: Germany, Gold, and the US Dollar and Silver, Science, and Scripture.
When Will the Great Tribulation Begin? 2023, 2024, or 2025? Can the Great Tribulation begin today? What happens before the Great Tribulation in the “beginning of sorrows”? What happens in the Great Tribulation and the Day of the Lord? Is this the time of the Gentiles? When is the earliest that the Great Tribulation can begin? What is the Day of the Lord? Who are the 144,000? Here is a version of the article in the Spanish language: ¿Puede la Gran Tribulación comenzar en el 2020 o 2021? ¿Es el Tiempo de los Gentiles? A related video is: Great Tribulation: 2026 or 2027? A shorter video is: Can the Great Tribulation start in 2022 or 2023? Notice also: Can Jesus return in 2023 or 2024? Here is a video in the Spanish language: Es El 2021 el año de La Gran Tribulación o el Grande Reseteo Financiero.
Does God Have a 6,000 Year Plan? What Year Does the 6,000 Years End? Was a 6000 year time allowed for humans to rule followed by a literal thousand year reign of Christ on Earth taught by the early Christians? Does God have 7,000 year plan? What year may the six thousand years of human rule end? When will Jesus return? 2029 or or 2031 or 20xx? There is also a video titled 6000 Years: When will God’s Kingdom Come? Here is a link to the article in Spanish: ¿Tiene Dios un plan de 6,000 años?
Might the U.S.A. Be Gone by 2028? Could the USA be gone by the end of 2028 or earlier? There is a tradition attributed to the Hebrew prophet Elijah that humanity had 6,000 years to live before being replaced by God’s Kingdom. There are scriptures, writings in the Talmud, early Christian teachings that support this. Also, even certain Hindu writings support it. Here is a link to a related video: Is the USA prophesied to be destroyed by 2028? In Spanish: Seran los Estados Unidos Destruidos en el 2028?
Anglo – America in Prophecy & the Lost Tribes of Israel Are the Americans, Canadians, English, Scottish, Welsh, Australians, Anglo-Saxon (non-Dutch) Southern Africans, and New Zealanders descendants of Joseph? Where are the lost ten-tribes of Israel? Who are the lost tribes of Israel? What will happen to Jerusalem and the Jews in Israel? Will God punish the U.S.A., Canada, United Kingdom, and other Anglo-Saxon nations? Why might God allow them to be punished first? Here is a link to the Spanish version of this article: Anglo-América & las Tribus Perdidas de Israel. Information is also in the YouTube sermons titled Where are the Ten Lost Tribes? Why does it matter? and British are the Covenant People. A short YouTube of prophetic interest may be: Are Chinese threats against Australia for real?
When Will the Great Tribulation Begin? 2022, 2023, or 2024? Can the Great Tribulation begin today? What happens before the Great Tribulation in the “beginning of sorrows”? What happens in the Great Tribulation and the Day of the Lord? Is this the time of the Gentiles? When is the earliest that the Great Tribulation can begin? What is the Day of the Lord? Who are the 144,000? Here is a version of the article in the Spanish language: ¿Puede la Gran Tribulación comenzar en el 2020 o 2021? ¿Es el Tiempo de los Gentiles? A related video is: Great Tribulation: 2026 or 2027? A shorter video is: Can the Great Tribulation start in 2022 or 2023? Here is a video in the Spanish language: Es El 2021 el año de La Gran Tribulación o el Grande Reseteo Financiero.
Who Was Herbert W. Armstrong? How is He Viewed Today? Includes quotes from the 1973 edition of The Autobiography of Herbert W. Armstrong and explains who he was and how he should be viewed today.
Lost Tribes and Prophecies: What will happen to Australia, the British Isles, Canada, Europe, New Zealand and the United States of America? Where did those people come from? Can you totally rely on DNA? What about other peoples? Do you really know what will happen to Europe and the English-speaking peoples? What about Africa, Asia, South America, and the Islands? This free online book provides scriptural, scientific, historical references, and commentary to address those matters. Here are links to related sermons: Lost tribes, the Bible, and DNA; Lost tribes, prophecies, and identifications; 11 Tribes, 144,000, and Multitudes; Israel, Jeremiah, Tea Tephi, and British Royalty; Gentile European Beast; Royal Succession, Samaria, and Prophecies; Asia, Islands, Latin America, Africa, and Armageddon; When Will the End of the Age Come?; Rise of the Prophesied King of the North; Christian Persecution from the Beast; WWIII and the Coming New World Order; and Woes, WWIV, and the Good News of the Kingdom of God.
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