When you combine a confidence game, fractional banking, and idiotic risk management with the Federal Reserve’s 13-year zero-interest rate policy regime, you get what we saw in recent days with Silicon Valley Bank. SVB can now be added to the list of infamous bank failures over the years, including Washington Mutual, IndyMac, Bear Stearns and Lehman Brothers. It’s the largest bank failure in terms of assets—some $209 billion at the end of 2022—since the 2008 financial crisis.
SVB’s Valley of Death
William D. Cohan
March 12, 2023
