The US Federal Reserve printed $300 billion in a week to save collapsing banks and bail out Silicon Valley oligarchs. 93% of Silicon Valley Bank’s deposits were uninsured, over the FDIC limit of $250,000, but the government still paid them. 56% of SVB’s loans went to venture capitalist and private equity firms.
US government bailout of Silicon Valley and banks is $300B gift to rich oligarchs
Category: Federal Reserve
Two Fed-Supervised Banks Blew Up Last Week; Two More Dropped Over 40 Percent Yesterday; and the Fed Wants to Investigate Itself — Again
Last Friday, California state regulators closed Silicon Valley Bank and the Federal Deposit Insurance Corporation (FDIC) became the receiver. Its stock price had lost over 80 percent of its market value over the prior year; $150 billion of its $175 billion in deposits were uninsured, either because they exceeded the $250,000 FDIC cap and/or they were foreign deposits. The bank was effectively operating as a Wall Street IPO pipeline in drag as a federally-insured bank. The Federal Home Loan Bank of San Francisco had quietly been bailing it out – to the tune of $15 billion. Oh – and by the way – its primary regulator was the Federal Reserve Bank of San Francisco. And while all of this hubris was occurring, the CEO of Silicon Valley Bank, Gregory Becker, was sitting on the Board of Directors of his regulator, the Federal Reserve Bank of San Francisco.
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Oh, and by the way, the Fed member banks in each of the 12 Federal Reserve Districts that can choose to be regulated by the Fed, literally own their regulator. That’s right, they own the stock in their regional Fed bank, which is a private institution, unlike the Federal Reserve in Washington, D.C. which is an “independent” federal agency. (See, for example, These Are the Banks that Own the New York Fed and Its Money Button.)
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Adding to the ongoing arrogance of the Fed, its Chairman, Jerome Powell, released a statement two minutes after the market closed yesterday, stating that “The events surrounding Silicon Valley Bank demand a thorough, transparent, and swift review…” So, once again, it’s decided to investigate itself. The Fed’s Vice Chairman for Supervision, Michael Barr, will oversee the investigation.
Pensions Lose Millions After Bank Collapse
Pensions across the globe have lost millions of dollars due to the collapse of Silicon Valley Bank (SVB).
In the wake of SVB’s Friday closure, several pension funds in the U.S. and two overseas have confirmed that they had investments in SVB stock that will likely be at a loss now that the bank has been shut down by federal regulators.
Pensions Lose Millions After Bank Collapse
Silicon Valley Bank wasn’t “woke”: Tech billionaires are just as bad as Wall Street bros
Ignore GOP hype about the “liberal” tech industry — reckless, entitled libertarianism is what fuels Silicon Valley
Silicon Valley Bank wasn’t “woke”: Tech billionaires are just as bad as Wall Street bros
Related:
Elizabeth Warren: Silicon Valley Bank Is Gone. We Know Who Is Responsible.
Taxpayers ARE on hook for bank bailout – and could even fund bankers’ bonuses
As regulators rush through emergency measures to prevent further chaos following the disastrous collapse of Silicon Valley Bank, there’s a point they’re very keen to emphasize: this is not a bailout.
Taxpayers ARE on hook for bank bailout – and could even fund bankers’ bonuses
Related:
Joe Biden stuck around just long enough to lie about who’s on the hook for SVB bailout
Michael Hudson: Why the US banking system is breaking up
Economist Michael Hudson responds to the collapse of Silicon Valley Bank, and explains the similarities with the 2008 financial crash and the savings and loan crisis of the 1980s.
Michael Hudson: Why the US banking system is breaking up
The government may stop issuing Social Security payments after the debt limit is hit — here’s why
An obscure provision of a 1996 law makes the Social Security trust fund vulnerable
The government may stop issuing Social Security payments after the debt limit is hit — here’s why (archived)
Sanctioning China Will Destroy The Dollar | America’s Ultimate Mistake
If the United States and its allies impose sanctions on China, this could be the greatest financial mistake in all of modern history. Unlike Russia, China is more resilient and has deeper ties across the global economy. Punishing China will likely backfire against the dollar and unleash a de-dollarization wave that could knock it off the reserve status. Here’s what you must know!
Sanctioning China Will Destroy The Dollar | America’s Ultimate Mistake via Sean Foo
Related:
One Year After Russia Mega Sanctions, Senate Asks ‘Can We Do Same To China”
America’s $52 Billion Plan to Make Chips at Home Faces a Labor Shortage + manufacturing chips in the US could make smartphones more expensive
America’s $52 Billion Plan to Make Chips at Home Faces a Labor Shortage
Another possible fix would be to keep people in the workforce longer, by raising the age at which workers can begin collecting Social Security or tapping into their pensions or 401(k)s. Yet Harry Holzer, a former US Department of Labor chief economist now at Georgetown University, says that neither feels politically feasible right now. Immigration has been a toxic issue in American politics for years, and Social Security has long been an untouchable entitlement. “None of that is doable,” Holzer says, which means “our labor force growth is going to continue to be modest.”
Related:
How manufacturing chips in the US could make smartphones more expensive
Morcos says a top concern of his is the narrowness of the CHIPS Act. Without bringing related device manufacturing back to the U.S., such as device batteries, sensors, cameras, antennas, and hundreds of other components, the manufacturing process could require the most critical component to be produced stateside, then shipped overseas to be assembled with hundreds of other components into a device that is then shipped back to the U.S. for the American consumer.
Work longer, for less pay, and you still won’t be able to afford the latest smartphone or laptop?! 🤷🏼♀️
China meets American hegemony head-on
In a rare scathing essay, Beijing’s foreign ministry has blasted Washington’s continued attempts at world domination
China meets American hegemony head-on
Related:
No holds barred as China launches frontal assault on American dollar hegemony
Disclaimer: This information is not presented as a source of financial advice. You should not rely, for financial advice, on statements or representations made within this blog or by any externally referenced Internet sites. Before making any final decisions or implementing any financial strategy, you should consider obtaining additional information and advice from your accountant or other financial advisers who are fully aware of your individual circumstances.
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