BIDEN’S BANKING CRISIS: At the 11th Hour, Regulators Will Protect All Silicon Valley Bank Depositors

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The Feds were shamed into it at the last minute. Badly handled. Badly done. It’s a mess.

After SVB failure, regulators close crypto-friendly bank Signature Bank

Banking stocks plummet:Banking stocks plummet in premarket trade:

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– First Republic Bank: -65%
– Western Alliance Bancorp: -64%
– PacWest Bancorp: -42%
– Charles Schwab: -7%

U.S. regulators will protect all Silicon Valley Bank depositors to stem fallout

By: American Greatness, March 13, 2023:

Federal banking regulators took aggressive new actions aimed at preventing depositors in failed Silicon Valley Bank from losing money — and at trying to prevent its downfall from unleashing a nationwide run across the banking system.

Why it matters: The extraordinary actions, using tools last deployed in the early days of the pandemic and in the 2008 global financial crisis, are an attempt to avert a broad banking crisis triggered by a run on the bank.

If unchecked, that would lead to cascading bank failures and potentially a broad financial crisis.

Driving the news: The Treasury Department, Federal Deposit Insurance Corp. and the Federal Reserve, citing “systemic risk” under which the agencies can take extraordinary actions, said that the FDIC’s insurance funds will be used to prevent depositors from losing money.

The action prevents a situation in which those who had more than the $250,000 per-saver cap on deposit insurance at SVB face potential losses.
The Fed also announced a new “Bank Term Funding Program,” invoking emergency authority, that enables other banks to obtain quick cash in exchange for collateral.

Meanwhile, President Biden said in a statement Sunday evening he’s “firmly committed to holding those responsible for this mess fully accountable and to continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again.”

The president said he would detail Monday on how his administration plans to “maintain a resilient banking system” to protect the U.S. economic recovery.

What they’re saying: “Depositors will have access to all of their money starting Monday, March 13,” said a joint statement from the Treasury, Fed, and FDIC. “No losses associated with the resolution of Silicon Valley Bank will be borne by the taxpayer,” saying the bank-funded FDIC insurance fund will absorb any costs.

“These actions will reduce stress across the financial system, support financial stability and minimize any impact on businesses, households, taxpayers, and the broader economy,” the Fed said in a statement.

Details: The Fed’s facility, implemented using section 13(3) of the Federal Reserve Act which authorizes emergency actions, allows banks nationwide to obtain immediate cash on highly favorable terms in the event they face a surge of withdrawals.

Notably, they can pledge long-term securities like Treasury bonds and mortgage-backed securities to the Fed and get access to immediate cash equivalent to their original value — even if the value of the bonds has fallen.
That should prevent other banks from getting into the jam that faced Silicon Valley Bank, where on-paper losses on such securities triggered a bank run.

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Chris Wolf
Chris Wolf
1 year ago

Who believes the taxpayers won’t get the bill for this week’s latest Biden woke Treasury heist? This is exactly why he’s hiring 87,000 — no, EIGHTY-SEVEN THOUSAND — new IRS stormtroopers to come to your house with weapons and conduct summary audits, just like “obama” planned.

Chris Wolf
Chris Wolf
1 year ago

Biden’s 87,000 new IRS agents won’t look like the little lady with the cashmere sweater and glasses on a gold chain sitting behind a computer screen.
They’ll look more like the Rwandan M23 troops who are now rampaging across the Congo.

Ronald Nuxon
Ronald Nuxon
1 year ago
Reply to  Chris Wolf

Actually, more like Nurse Ratchet.

PatDD
PatD
1 year ago
Reply to  Chris Wolf

He should have hired 87000 more DHS agents instead!!!!! Can’t fix STUPID with a moron!

Chris Wolf
Chris Wolf
1 year ago

SVB is a conduit for the arming and mobilization of the onslaught of Black and Brown looting and confiscating America financed by us.

Armaros
Armaros
1 year ago

The regime merges with its sympathetic banks
What can go wrong…
The regime protects its enforcers in tech

Snowedin
Snowedin
1 year ago

The government is bailing out these banks out like they did before. This is how they make sure that they have more control over the banks and our money.

edD
ed
1 year ago

EVERYTHING the fake, phony, corrupt & illegitimate Biden administration has done. Since Day 1. Badly handled. Badly done. It’s a mess.

Grendel
Grendel
1 year ago

The “federal government” HAS NO MONEY!!!!!
The only money they have IS YOURS …. that they have, strong arm, stolen from YOU by virtue of UNLAWFUL TAXATION.

We take our Republic back …. or we lose it.
It really is that simple.

PatDD
PatD
1 year ago

The moron is making promises that he can’t fulfill!!!! Congress makes the laws and holds the purse strings NOT the moron in the WH!!!!!

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