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57 votes

Was Silicon Valley Bank's failure due to "Trump-era deregulation", and/or do Democrats share blame for it?

I was hesitant to answer this because I'm not certain I'm enough of an economist to give you a full answer. However, I think I can explain much of what you asked, and in the end I'm not convinced ...
dsollen's user avatar
  • 8,973
33 votes

Why is the ongoing auction for Silicon Valley Bank started held privately (vs. publicly)?

"Public" has a particular meaning in a share sale. It means that any investor can purchase shares and comes with lots of rules about transparency. But what the regulators want is a single, ...
James K's user avatar
  • 115k
32 votes

To what extent does China need the SWIFT system?

China needs the SWIFT system quite a bit, because its economy is heavily driven by international trade, especially exporting manufactured goods, in a diversified market with large numbers of small to ...
ohwilleke's user avatar
  • 73.8k
17 votes
Accepted

Why didn't Silicon Valley Bank ask for a loan from the Fed as the lender of last resort?

Because that would be a bailout and the US government [regulators] said "no bailouts" in this case. Now the FDIC owns all of the banks assets (as a bridge bank) and is trying to sell them (...
Fizz's user avatar
  • 146k
14 votes

To what extent does China need the SWIFT system?

In a nutshell, to the extent that it wants to trade with the West, or at least to the extent that it likes to have a trade surplus with the latter. China is not yet in a position to impose its own ...
Fizz's user avatar
  • 146k
12 votes

Does the Federal Reserve insure the money of all depositors?

The Federal Deposit Insurance Corporation is insuring deposits up to $250,000 per owner. A bank run can still happen (still did happen, in the recent case of the SVB) when large customers are starting ...
o.m.'s user avatar
  • 106k
11 votes

Does the Federal Reserve insure the money of all depositors?

It depends on what you mean by "bank run". It's generally understood to mean a situation where depositors make withdrawal demands that exceed the assets of the bank that are sufficiently ...
Acccumulation's user avatar
10 votes

Does the Federal Reserve insure the money of all depositors?

The Federal Reserve in its role as lender of last resort will lend money to a solvent bank that’s suffering a bank run and having temporary cash flow problems. But it appears that SVB was insolvent — ...
Mike Scott's user avatar
  • 3,864
10 votes

Can governments avoid being trapped between the choice to let a big bank fail or increase banking concentration?

The Glass-Stegall legislation was meant to prevent these types of situations. The legislation puts a firewall between "commercial bank" and "investment bank" activities. There's ...
QuantumWalnut's user avatar
10 votes

Why didn't Silicon Valley Bank ask for a loan from the Fed as the lender of last resort?

The math on a loan from the Fed may not have worked out A loan from the Fed would have to be paid back at current interest rates. Meantime, SVB is getting payments from long-dated bonds that it ...
Nobody's user avatar
  • 1,716
9 votes

Was Silicon Valley Bank's failure due to "Trump-era deregulation", and/or do Democrats share blame for it?

It's not entirely clear to me what they are talking about, but if it's about the LCR requirement that was relaxed in 2018 for banks under $250 billion, then if you believe BPI's calculation, SVB would ...
Fizz's user avatar
  • 146k
8 votes

Has any government published a cost benefit analysis on KYC regulations in terms of frequency of data loss?

I haven't seen such an analysis, but certainly information security is on the radar of states. However it's worth correcting a wrong assumption in the question. The purpose of accepting copies of ...
Steve's user avatar
  • 4,760
7 votes

Why didn't Silicon Valley Bank ask for a loan from the Fed as the lender of last resort?

SVB was insolvent; its assets were less than its liabilities. Even if all its stuff was sold there wouldn't be enough money to pay all the depositors - even though it may have pretended there was, by ...
user253751's user avatar
  • 1,965
7 votes

Was Silicon Valley Bank's failure due to "Trump-era deregulation", and/or do Democrats share blame for it?

The collapse of the Silicon Valley Bank may not have been the fault of either Republicans or Democrats. It was foremost the result of a bank-run facilitated by panicking investors and the general ...
NoDataDumpNoContribution's user avatar
5 votes

Has any government published a cost benefit analysis on KYC regulations in terms of frequency of data loss?

Know Your Customer rules are not about identifying the individual. If that was the goal, the customer presenting their Passport (or other national ID) would fully do that. The knowing of the customer ...
Ángel's user avatar
  • 153
5 votes

What exactly was Russia supposed to get as part of the Black Sea Grain Initiative?

The deal made Russian agricultural exports exempt from sanctions Besides the fact that there may well have been some non-public clauses within the initiative, its public part looks quite symmetric: ...
Alex Serenko's user avatar
4 votes

Why is confidence in U.S. banking at 27%?

Looking at the historical data for that poll might offer some insight. Until 2006, of those asked, around 50% had a "great deal / quite a lot" of confidence in banks (comparable to ...
tim's user avatar
  • 36k
3 votes

Why is confidence in U.S. banking at 27%?

Banks and bankers are not "popular". They seem to be making money (lots of money) without actually making anything. And that's when things are going well, when things go badly people can ...
James K's user avatar
  • 115k
3 votes

Why is the ongoing auction for Silicon Valley Bank started held privately (vs. publicly)?

It's not terribly clear what you mean by those terms, but FDIC doesn't sell a failing bank to random Joes (or even to Elon Musk[s] directly), but to other banks, basically: The FDIC markets troubled ...
Fizz's user avatar
  • 146k
3 votes

Does the Federal Reserve insure the money of all depositors?

Does the Federal Reserve insure the money of all depositors? No. The Federal Reserve doesn't insure the money of any depositors. The Fed doesn't make any promises of that kind. But it can make ...
ohwilleke's user avatar
  • 73.8k
3 votes

Can governments avoid being trapped between the choice to let a big bank fail or increase banking concentration?

Is there a way for governments to avoid to remain trapped between two evils? Increase banking concentration or risk a systemic failure. Yes. A few options come readily to mind: Allow foreign banks ...
ohwilleke's user avatar
  • 73.8k
2 votes

UK budget and the financial services industry

As Wikipedia explains what the twin deficit [often] means in practice is that In effect, the economy is borrowing from foreigners in exchange for foreign-made goods. Which is probably what the BBC ...
Fizz's user avatar
  • 146k
2 votes

Can governments avoid being trapped between the choice to let a big bank fail or increase banking concentration?

The too-big-to-fail problem has two components, first the number of entities that are too big and second the expected loss if they need to be rescued. Both components can be limited with readily ...
NoDataDumpNoContribution's user avatar
2 votes

Was Silicon Valley Bank's failure due to "Trump-era deregulation", and/or do Democrats share blame for it?

Has Biden or Warren really said that "Trump-era deregulation" contributed to Silicon Valley Bank's failure? It seems to me that Senator Warren's tweet implies that pretty clearly, but she ...
Nate Eldredge's user avatar
2 votes

Was Silicon Valley Bank's failure due to "Trump-era deregulation", and/or do Democrats share blame for it?

I noticed one point that has not been covered here and that is s.104 of the Economic Growth Act (Link) For companies that have holdings between 100 billion and 250 billion the FED board/governor has ...
P J's user avatar
  • 21
1 vote

Bank and state cooperation in green transition: What is the political nature of this alliance?

The reason for Basel 1 and the lot has to do how with how banks go around their core function: managing money and societies' risk exposure to how they manage money. Mostly it has to with reserve ...
Italian Philosophers 4 Monica's user avatar

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