What took place Friday was an old-fashioned bank run: Customers yanked $42 billion from Silicon Valley Bank on Thursday, leaving the bank with $1 billion in negative cash balance, the company said in a regulatory filing. In other words, the bank owed more to customers than it had on hand. SVB and federal regulators scrambled but couldn’t raise enough capital to make up the difference, and the bank was declared insolvent Friday. The Federal Deposit Insurance Corp.
First Republic Bank\n \n , PacWest Bancorp\n \n and Signature Bank\n \n fell so much Friday they tripped an automatic circuit breaker and were temporarily halted so nervous investors could take a breather. First Republic’s stock is down 29% over the past two days. Signature is down 32%.
Republicons will say tax cuts for the rich and deregulation should fix it.
Absolutely no bank bailouts this time.