Jerome Powell and the Federal Reserve just orchestrated a massive bank BAILOUT. The Fed will print money to make sure the depositors of Silicon Valley Bank have full access to their uninsured deposits. A bailout that could cost over $150 Billion.
This bailout is bad for working Americans. Because it forces the Fed to print money to save the deposits of wealthy tech executives in California as well as tech companies like Roku. Normally FDIC insurance won’t cover past $250,000 in a bank account. But now that guarantee was just made unlimited by the Federal Reserve, Janet Yellen, and Joe Biden.
Which will likely contribute to more moral hazard and risk taking in the US financial system. Especially because the Fed did not fix the two key problems facing banks right now:
1) a contracting money supply, and
2) 0% reserve requirements
Due to the Fed’s quantitative tightening program, the money supply in America is contracting. Which is historically a signal of depression and bank crises. Moreover, banks are now no longer required to hold a minimum amount of reserves, meaning they are more exposed to a banking crises.
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The Federal Reserve, also known as “The Fed,” has just made a massive bailout to provide liquidity support to the U.S. financial system, in the wake of the current global pandemic.
In the midst of the ongoing COVID-19 pandemic, the underlying financial structure of the United States has been under enormous pressure. This is because many Americans have lost their jobs and businesses have closed, as the country grapples to slow down the spread of the virus.
The Fed’s recent bailout, which is estimated to be in the trillions of dollars, is aimed at mitigating the economic impact of the pandemic. In a statement released by The Fed, it announced that it would be providing loans to banks, providing credit to employers, and purchasing government bonds to ensure that there is enough liquidity in the market.
The bailout will be carried out in three phases, and it will be available to businesses of all sizes. The first phase will involve providing emergency loans to small and mid-sized businesses, while the second phase will provide support to larger businesses impacted by the pandemic.
The third phase of the bailout will be directed toward individual Americans, providing direct financial support to those who have been directly affected by the pandemic, such as those who have lost their jobs or businesses.
The latest bailout is being considered one of the largest in U.S. history. This move is a reflection of the severity of the situation that the United States is facing as it tries to battle the COVID-19 outbreak.
While the bailout will provide much-needed relief for the U.S. financial system, there are concerns that the approach could lead to inflation or cause more long-term economic damage.
But the hope is that this action will provide much-needed financial support and help ease the burden on businesses and individuals as they weather the ongoing impacts of the COVID-19 outbreak.
In conclusion, the Fed’s recent massive bailout will undoubtedly have a significant impact on the U.S. economy, and it is hoped that this action will help ease the financial burden of many Americans impacted by the pandemic. Only time will tell if it is enough to stabilize the market and prevent further economic damage.
Wow that should be for bailing out Wells Fargo and BofA when things spread
The FDIC had to do something to cut off contagen. Hoever, they should have given SCBs depositors a 20% haircut on any amount of rhe deposit above 240k.
And
That big mouth who created the panic on social media should be held to account, as well.
What's so perfect is that all you need to see is a guy who looks like this to know it's a waste of your time.
The US rewards and is run by rich communists. What's the point of having rules if Yellen doesn't follow them? The law of Dodd Frank and FDIC limits aren't being followed. This is illegal
This was Democrats taking care of their donors.
It is unlikely that the market will experience big gains anytime soon in light of the latest developments involving SVB, therefore it is prudent to set reasonable expectations and get ready for a potentially protracted recovery period. It is advised to postpone making big investment decisions until the economic climate in areas of concern has stabilized. It is best to take precautions and stay out of the current disturbance.
The taxpayers are still paying for the holding cost of the Fed to hold low yield securities until they return to par
The depositors were mostly climate tech firms that are part of IRA bill, and SVB was the bank scheduled to process the IRA loans/grants
It's the safe world idea we can't have failure
You should cancel all your housing crash videos for 2023, there will be no housing crash in 2023.
08:47, it just went up!!!
Nick, you were 100% spot on with the Fed balance sheet prediction. It looks like assets went up by more than $200 billion in 2 weeks. Undoing the last 5-6 months of QT
FDIC insures each bank account for that amount for each individual account…folks just have to make sure not to keep more than insured amount in each account they have. It has always been that way, but depositors get lazy when they breech that amount.
Great analysis TQ
No problem at FDIC and Fed as the SVB most of invest are in Bond they already have the money to begin with
EASY WIPE IT AVATAR AND ONCE THEY THINK PUT IN IN NUMBER BOUNCE THE CHECKS OR WITH DRAW's ANY MONEY THEN ALL KNOWS THE CON's STOCK's OF SUITS CRIME's ! SELLING TWO WHO TRAMP WHAT YOU STOLEN NOPE THAT YOUR SKIN TRAMP's AND YOUR HURTS NEED LIGHT IT''s GOING TWO GET WARN !
IF THE BANKS LOAN's 7 % FOR ALL LOAN's AND THE CENTRAL BANK's ARE 7% HOW DOES ANY BANKS PAY THE STAFF IF THEY ARE ALL PAYING 7 % ON THE BANK's WANTING LOAN's FROM THE OTHER BANK's AT 7% THIS MEAN COULD PAY STAFF OR THE BUILDING RENT' THEY MAKING THE BANK'''s THAT HAVE BACKING ARE FORCE TWO PROP UP FAKE BANK's THIS JOE BOY PLANS OR CREW TAKE ALL OUT AT ONCE AS ALL FAIL THAT TWO BIG ! AND BAIL OUT's ON AIR COMPUTERS TAXES FROM THE CON''s !
There isn't they gotta be alive because it's in a liberal state with liberal depositors yes that happened in a conservative state with conservative depositors they wouldn't have gotten nothing
SVB, just like Facebook, Google, and Twitter, allies with the Democrat stealing the 2020 election. And that's the main reason why they got the free-pass…
Where is king biden going to get this money?
Everybody withdraw all funds from all banks. Crash the whole system!
The only bailout they should be awarded is a free trip to the gallows.
So crazy what about bailing us regular working people out. Not enough assets to sell. Get the executives stock sales money back
Why get upset? That won’t accomplish anything. We are toast and China is licking its chops.
Janet Yellen is a commie idiot
The failure of Silicon Valley Bank has torn into global markets, with investors ripping up their forecasts for further rises in interest rates and dumping bank stocks around the world. I'm at a crossroads deciding if to liquidate my dipping 200k stocck portfolio, what’s the best way to take advantage of this bear market?
Powell's decision: Do we reverse? IF so, It must be significant and will cause hyperinflation and a crack up boom. Do we keep rates up and keep tightening? IF so, we will experience a deep recession that will quickly turn into a deflationary death spiral.
it is because almost all the tech companies in silicon valley are left, or far left.
The Dems are protecting their powerful friends and donors.
Are the feds just supposed to let regional banks collapse?
Not to mention SVB is a commercial bank, potentially saving hundreds of start-up tech companies and thousands of jobs.
You think only rich corporate wieners lose if the government doesn't bailout?
Where's the bail out for East
Palestine houses that have plunged in value? The farmland that's poisoned? The restaurants and businesses that people won't visit anymore?
They're all left to die
But if you're woke, big tech?
You get every dollar you need in a single weekend.
Can you say more inflation my guys. More money more inflation.
Crushes your narrative (one that you helped create – congrats!) – however, now it’s giving you even more of opportunity for you to keep going on about this shit and making the situation worse.
How long do you actually have to be able to say you were correct about this (dr doom & gloom)???
If you have one, you must be ALL-in on put options, eh? Why of course you are!!!…
If you just keep at it, you will eventually be right. Again, congratulations. You’re obviously tuned-in that doom and gloom speech gets more views than a normal market condition. So you probably love the fact you can extend making your precious videos – douchebag!
Dude…great video. Gov't gotta go, they are wrecking our world.
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Musical chairs comes to mind.
You turned into a grade A scam artist and click bait dbag… congrats on your ability to get views and enrich yourself through dishonest means
The Banks are required to hold
10% for the “Big Guy.”