Reply to SVB Bank Run: Fed Calling Emergency Meeting

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]So there are all of these libertarians etc calling on the Fed/FDIC to basically take over and secure the bank.

Keep in mind, this i only happening because Trump totally gutted regulations that would have prevented this from happening. So we are going to get a massive bailout for Silicon Valley Bank and yet people complain about a few thousand dollars in bailouts for student loans.[/quote]

For one, the FDIC already took over the bank around 24 hours ago

Two, this is not caused by Trump gutting regulations. The cause was interest rate risk- recall people deposit money at banks and they turn around and lend money, in this case in the form of MBS and treasuries. The fed kept interest rates too low for too long and then they hiked rates precipitously, which caused huge losses for the bank on those securities that were purchased when interest rates were much lower[/quote]

Disagree. Trump gutted Dodd-Frank that would have protected against this.[/quote]

NP. Why do you think that’s true? Lots of us knew that Dodd-Frank was quarter-assed. While it could have been worse, it was clearly an attempt to put Humpty-Dumpty back together.

I will say that those putting all their faith into Dodd-Frank are not half as ridiculous as the govt spending/inflation obsessed crew. At the very least, those folks need to figure out ZIRP first.[/quote]

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