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Home News Financial Meltdown: SVB Now The 2nd Biggest Bank Failure In US History

Financial Meltdown: SVB Now The 2nd Biggest Bank Failure In US History

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Financial Meltdown: SVB Now The 2nd Biggest Bank Failure In US History

(FamilyConservationPAC.com) – Silicon Valley Bank now ranks as the second-largest bank failure in American history. Its website, which will probably remain online for the foreseeable future, shows its assets valued at $212 billion.

Yet, as the adage goes, the bigger things are, the harder they fall.

Surprisingly, the Federal Deposit Insurance Corporation (FDIC), which only insures accounts up to $250,000, does not cover 93% of the bank’s $161 billion deposits.

U.S. Treasury Secretary Janet Yellen said a few banks are being monitored “very carefully” and that it’s a “matter of concern” that banks such as SVB Financial are experiencing financial losses:

Sec. Janet Yellen said SVB would not be bailed out:

For example, Roku held $487 million in Silicon Valley Bank. And that’s just one of the few whales mentioned.

Come Monday morning, many CFOs—those in charge of managing a company’s finances—will need to explain themselves.

Speaking of “explaining,” SVB representatives must respond to several inquiries, such as, “what part did wokeness play in SVB’s failure?”

ESG, which stands for “environmental, social, and governance,” is a different acronym for wokeness. ESG is an important topic since much economic research indicates that woke investments are poor investments.

For instance, a study conducted by professors at Columbia University and the London School of Economics reveals that:

“ESG funds appear to underperform financially relative to other funds within the same asset manager and year and to charge higher fees. Our findings suggest that socially responsible funds do not follow through on proclamations of concerns for stakeholders.

In other words, ESG is a sham and makes less money than it costs.

Of course, it may be OK if ESG investing relieves the conscience of credulous trust funders. Yet, as a significant ESG bank fails, we can see the threat of systemic risk to the entire economy. That occurred in 1929 when bank failures began to follow one another.

Did President Trump predict this?

Thus, it’s humorous in a not-funny manner that Treasury Secretary Janet Yellen was pleading for action on ESG as recently as March 7.

“A delayed and disorganized shift to a net-zero economy can result in disruptions to the financial system,” she warned.

“Although we have yet to reach net zero and likely never will, especially as China continues to build coal-fired power plants, the financial system has already experienced a shock,” she added.

Then there is the issue of going above and beyond what the FDIC requires to save SVB. According to a report from The Washington Post on Saturday, a “ferocious political discussion” has broken out in Washington, D.C., over a political solution that might cost taxpayers many billions.

Yet, a more severe and extensive banking crisis might hurt the economy and cost Biden many votes. What Washington, D.C., will do is, therefore, still being determined.

However, in the interim, it will be challenging for financial officers across the spectrum—in banks, investment firms, pension funds, insurance companies, and university endowments—to contend that they can be woke while still upholding their fiduciary duty if the evidence keeps mounting that woke/ESG is a terrible business.

If broken, this responsibility is a complex legal idea with severe civil and even criminal implications.

Of course, many people have expressed concern about the risks of ESG, including House Majority Leader Steve Scalise (R-LA) and several individuals who have direct responsibility for expanding and protecting pension funds, such as Riley Moore, the state treasurer of West Virginia.

The State Financial Officers Foundation, a new network of investment managers with a right-leaning perspective, even exists.

So, prepare for a scramble as the “ESG Emperors” rush to assure us this is OK, including Al Gore, Larry Fink of BlackRock, and even Bono.

Well, let’s get back to SVB and its comprehensive fiduciary duty, which applies to federally regulated institutions. I mean, nobody wants another Depression, right?

As we review the bank’s financial statements, let’s consider SVB’s fiduciary duty. (We can speculate about any more legal transgressions that may have occurred later; after all, blowing $212 billion is significant.)

As an illustration, consider the SVB headline from January 10, 2022: “Silicon Valley Bank Commits to $5 Billion in Sustainable Finance and Carbon Neutral Operations to Support a Healthier Planet.”

Sounds really “green,” right?

Was that, however, the best use of the money? The only thing we can be sure of is that CEO Greg Becker decided to avoid addressing the fiduciary issue when he stated, “Our ability to make a meaningful difference for people and the planet and to address the systemic risk that climate change presents is magnified by the outsized impact our innovative clients make.”

For some individuals (not including, for example, the slave laborers in Africa mining green minerals) and perhaps for the world (not including the bald eagles killed by windmills), all that money may have seemed terrific.

But it doesn’t appear great for SVB investors and depositors.

SVB has much to say regarding ESG:

“Our corporate philosophy of transparency and accountability guides our reporting on environmental, social and governance performance with the goal of building trust and evolving our policies and disclosures.”

Indeed, that is what SVB is all about. Fostering trust. Yet, some people create it in an odd way.

For instance, on February 27, SVB CEO Becker sold $3.6 million worth of stock.

Did he have any knowledge? Has he utilized insider knowledge? (There are many other, particularly onerous laws, about that.)

And it gets better. Here is some more green nonsense from SVB:

“We support entrepreneurs and high-growth businesses at the forefront of innovation, helping to advance solutions that create a more just and sustainable world. Our longstanding commitment to innovation, combined with our deep experience supporting evolving technologies, enables us to contribute to a healthier planet via our own efforts and those of our clients.”

It’s a good play on words for a “woke” company to use. All you have to do is include “just,” “sustainable,” and “healthier earth,” and BOOM – Winning!

Naturally, SVB also places a lot of emphasis on DEI (Diversity, Equality, and Inclusion), stating, “We’re establishing a culture of belonging with a global workforce that appreciates more dimensions of diversity.”

Yet again, more play using “woke” words. And to obtain a better understanding of SVB’s DEI footprint, we might take into account the following (since deleted) tweet from Christina Qi, a former CEO of a hedge fund:

“The SVB collapse has been devastating in more ways than one: They supported women, minorities, & the LGBTQ community more than any other big bank. This includes not just diverse events, but actual funding. SVB helped us move one step forward; without them, we move two steps back.”

One astute tweeter replied, “Maybe other banks will look at this failure and learn they need to perform actual banking instead of virtue signaling” about the collapse.

Hmm. Was all of that moral virtue-signaling in line with my fiduciary duty? Is this the thing the Biden administration might decide to save?

Sometimes The Best Disinfectant Is Sunlight And Air

Cutting through this spiel is problematic since, as the song says, “the information’s unavailable to the mortal man.” Thankfully, there are subpoenas and other investigative tools to help.

Hence, even though the Biden administration might not be keen on going too far into SVB, others will.

Moreover, at least on their Republican side, the fate of SVB is a subject of congressional investigation panels.

Vivek Ramaswamy, a former businessman and current presidential contender for the Republican Party, is one early woke watchman who understands how this might function. After the SVB’s collapse, he tweeted the following:

Moreover, congressional hearings can be educational for those interested in learning where their money has gone and those simply curious about how the wealthy spend other people’s money.

Google “Pujo,” “Pecora,” and “Enron,” as well as “Lehman Brothers,” if you’re interested in how they’ve operated in the past.

Sources discovered that the financial actors in each of those previous cases were either deceptive or not as strong as they had been represented to be.

Each financial crisis was overcome, although many individuals lost money and few people were sent to prison.

So does SVB demonstrate that the green economy is a sham?

Let’s consider the Biden administration, for example.

Biden No Longer Walks The Green Mile

The Biden administration is allegedly about to make a sharp turn, sanctioning a new carbon-fuel development in Alaska, after two years of steadfastly opposing meaningful energy measures from day one (thankfully, some of Biden’s worst moves were prevented by bipartisan opposition in Congress).

For U.S. energy consumers, this means 600 million barrels of oil, which is fantastic news (which is all of us, whether we admit it or not). Yet, that also means 9.2 million tons of CO2 are released into the environment, which is bad news for plants.

Why the change in favor of Big Oil?

https://twitter.com/AnneEHawke/status/1634395496914604032?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1634395496914604032%7Ctwgr%5Eaef568bb190617b3079a415a90ea2bb89eb358f6%7Ctwcon%5Es1_c10&ref_url=https%3A%2F%2Fpublish.twitter.com%2F%3Fquery%3Dhttps3A2F2Ftwitter.com2FAnneEHawke2Fstatus2F1634395496914604032widget%3DTweet

Politico Playbook parodied the response as “Biden’s vulgar move to the center”—i.e., where you win re-election. Politico continued, saying it was “another Biden administration policy move that is stirring up trouble on the left, this time from environmentalists.” (Biden’s consent to the GOP criminal measure is the second significant left-agitating development that stands out.)

The takeaway from this story is that Joe Biden genuinely wants to be re-elected. Therefore, if doing so involves abandoning his ideological green energy ideas, he will do so before you can say “flip-flop.”

Deciding whether to rescue financial greens (the significant depositors and investors in SVB) is more complicated. After all, a large portion of them contributed to Biden’s campaign.

He will act swiftly to conceal the financials from the public if the Biden administration believes doing so will help them. The entire Biden family has demonstrated that.

Therefore, in 2024, will Joe Biden be able to use his proven strategy nationwide? We are unable to know just now. But if you hear Janet Yellen yelling, “Drill, baby, drill,” you’ll know he’s giving it his all.

By the way, this is basically what SVB, Wells Fargo, JP Morgan, Bank of America, and Citi are doing with your money:

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