* Billionaire hedge fund manager Bill Ackman is predicting an economic meltdown following the collapse of Silicon Valley Bank
* Ackman is urging the US government to take action to protect all of the bank's depositors fearing there could be a ripple effect across other smaller banks
* Greg Becker, the CEO of SVB Financial Group, sent a video message to the bank's employees, acknowledging the bank's 'incredibly difficult' last 48 hours
Billionaire hedge fund manager Bill Ackman is forecasting 'economic meltdown' within hours of the banks opening up on Monday morning following the failure of Silicon Valley Bank.
Ackman is urging for the U.S. government to finally step in and protect all of the bank's depositors, warning inaction could lead to a ripple effect across other smaller banks within the industry.
The worry is that customers will rush to withdraw cash from their accounts fearing instability across the banking system with the very real possibility of a domino effect.
Read more ....
WNU Editor: The US government is sticking to the line that there will be no bail-out .... Yellen: No federal bailout for collapsed Silicon Valley Bank (AP). More here .... Treasury Secretary Janet Yellen says U.S. government won’t bail out Silicon Valley Bank (CNBC), and here .... Yellen Says Government Will Help SVB Depositors But "No Bailout" As Fed, FDIC "Hope" Talk Of Special Vehicle Prevents More Bank Runs (Zero Hedge).
Asked whether the government might bail out banks as it did during the 2008 crisis, @SecYellen says, “We’re not going to do that again.” But she adds, “We are concerned about depositors and are focused on trying to meet their needs.” pic.twitter.com/sg5WBFWfPj
— Face The Nation (@FaceTheNation) March 12, 2023
As to what is my take. I am nervous.
This could be the tip of the iceberg .... Silicon Valley Bank imploded in a single day. It could be just the tip of the iceberg. (Business Insider).
I saw first hand the collapse of the Russian banking system in 1992, and I am seeing the same factors at play today as I saw 31 years ago.
I do expect a massive intervention by the US government to stabilize the situation this week. And what will not be in the debate will be on how policies from the White House and the US government got us into this crisis.
Update #1: Are we going to see bank runs tomorrow? .... Contagion spreads: Desperate customers line up outside First Republic Bank to take their money out - after SVB bank collapsed and sent shockwaves through market (Daily Mail).
Update #2: This crisis is going global .... SVB Fallout Spreads Around World From London to Singapore (Bloomberg).