I spend precious little time boning up on financial institutions and their risk portfolios, but this is intriguing... I haven't seen why the bank run started but with the run the first day, the bank had to sell some treasuries to make up for the loss in deposits. The problem is they had a HUGE number of REALLY low interest rate instruments and had to sell their 1%ers in a 6% market and took HUGE losses. No clue on woke stuff but inflation really played a role here in addition to - educated guess here - some bad back office competence and maybe some carelessness by the regulators.
I'll get the number wrong but less than 1% of their customers have accounts that will be covered by FDIC. MOST of their customers have accounts in the hundred of millions and they are THE bank the start-ups here - and in CHINA!!!!!! - utilize. Lots of rich Californians have called for the fed to make each and every depositor whole but Yellen came out today and said "nades la grande".... That is the right answer.
Anyone concerned by a larger contagion?
I'll get the number wrong but less than 1% of their customers have accounts that will be covered by FDIC. MOST of their customers have accounts in the hundred of millions and they are THE bank the start-ups here - and in CHINA!!!!!! - utilize. Lots of rich Californians have called for the fed to make each and every depositor whole but Yellen came out today and said "nades la grande".... That is the right answer.
Anyone concerned by a larger contagion?
