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The collapse of Silicon Valley Bank was caused by a massive run on the bank, with customers initiating withdrawals of $42 billion this week.
The bank was placed into Federal Deposit Insurance Corp. receivership on Friday after the California Department of Financial Protection and Innovation (DFPI) determined the bank had been rendered insolvent.
Prior to the run on the bank, the bank was in “sound financial condition,” according to the DFPI. Customers withdrew $42 billion, leaving the bank with a negative cash balance of $958 million.
Here’s the summary of what happened from the DFPI’s order taking possession of the bank:
On March 8, 2023, the Bank announced a loss of approximately $1.8 billion from a sale of investments (U.S. treasuries and mortgage-backed securities). On March 8, 2023, the Bank’s holding company announced it was conducting a capital raise. Despite the bank being in sound financial condition prior to March 9, 2023, investors and depositors reacted by initiating withdrawals of $42 billion in deposits from the Bank on March 9, 2023, causing a run on the Bank. As of the close of business on March 9, the bank had a negative cash balance of approximately $958 million. Despite attempts from the Bank, with the assistance of regulators, to transfer collateral from various sources, the Bank did not meet its cash letter with the Federal Reserve. The precipitous deposit withdrawal has caused the Bank to be incapable of paying its obligations as they come due, and the bank is now insolvent.
Prior to its collapse, Silicon Valley Bank was the 16th largest bank by assets in the U.S. Federal Reserve data shows the bank had $209 billion in assets as of December 31, 2022.
How It Happened . . .
Peter Thiel’s Founders Fund and several other high-profile venture capital firms (i.e. Coatue Management, Union Square Ventures) advised their portfolio companies to pull money from Silicon Valley Bank on Thursday, responding to panic about the bank’s financial situation in tech startup circles.
They asked on Thursday. By Friday morning, the Bank was dead.
OPINION
It __looks__ like Peter Thiel and some of his Venture Capital buddies, panicked.
When they told their pals to pull money out of the bank over a measly $1.8 Billion loss during the Bank’s sale of some Mortgage Backed Securities, that set in motion the collapse of the bank.
Had Thiel and his pals just left things alone, it seems to many people the bank would still be standing.
Now, its a gigantic mess.
As a result of this mess, things can go one of two ways:
1) The mess is contained, FDIC comes in, protects basic depositors, and sells-off the rest of the Mortgage Backed Securities, and ****some**** of the uninsured Depositors get ****some**** of their money back . . . . years from now, OR;
2) The mess is NOT contained and this mess snowballs into a gigantic systemic collapse.
Next week will be telling about which way this will go.
UPDATE 9:25 AM EST (Saturday) —
The Bank of London is exploring the possibility of assembling a Rescue offer for Silicon Valley Bank (SVB) UK as start-up founders warn Jeremy Hunt that its collapse will “cripple” the British tech sector,
Elon Musk just said he is “open to the idea” to buy Silicon Valley Bank and become a digital bank. (HT REMARK: As long as no major U.S. bank is willing to touch it, I wouldn’t expect Elon’s “golden touch” to stabilize everything.)
China orders its Finance Ministry to sell its US Treasuries at “fastest pace.”
Meanwhile, the People’s Bank of China has added over 102 tons of gold in 4 months in an attempt to limit counterparty risk in a conflict with the US over Taiwan.
Comments
#Red Dawn Invasion Dream — Dolph2023-03-11 20:55
https://444prophecynews.com/a-red-dawn-invasion-is-coming-monique-bizet/
-1 #Dream: Russia & China Invasion — Dolph2023-03-11 20:42
https://444prophecynews.com/invasion-valeria-porter/
+1 #Planned Fear and Panic — Faith112023-03-11 20:04
What if the run on the bank Silicon Valley Bank was planned to cause a wave of fear and panic
to cause a run on other banks ? Why would people for no reason withdraw $42 billion in a week?
+2 #Nope — Loki2023-03-11 18:51
“Despite the bank being in sound financial condition prior to March 9, 2023, investors and depositors reacted by initiating withdrawals of $42 billion in deposits from the Bank on March 9, 2023, causing a run on the Bank.”
Nope! Executives at SVB including the Chief Exec. sold their stock two weeks prior to the loss in value of stock in SVB and THAT is what initiated the few to get some of their money out of SVB. The withdrawals were from an already sinking ship.
Jim Cramer on Mad Money said SVB was in good shape just last week. It was not. This is the inevitable result of too much debt and the resultant TSUNAMI of more debt from the 2008 crisis (caused by too much debt). The entire world banking system will go down in 2023. Prepare to fight.
+2 #Agree — ellis2023-03-11 19:28
If the bank leadership had not cashed in prior to this, it would have been believable that it was just a bank run. When more than one top leadership bails beforehand, this is no accident.
+1 #Two Strong Prophecies — Dolph2023-03-11 17:29
Last November 14, Corria T. had a dream of the East Coast of the US with a straight black line running from Maine to Florida some distance in from the ocean. She felt water come up around her feet and the whole East Coast WAS GONE! She knew this was a warning and before she woke up she heard an audible voice say, “FOUR MORE MONTHS”. (That would be this coming Tuesday). After she woke up she prayed and asked the Lord if this dream was from Him. She then had a conversation with a believer in Arizona who asked, Have you seen the video I posted last night about a prophecy of a tsunami coming to the East Coast of the U.S.? This was the same night as her dream! Stan Johnson of the Prophecy Club reported this last week and noted there have been approximately 20 prophetic dreams and visions over the past ten years of a giant tsunami hitting our East and Gulf Coasts. Corria didn’t know what caused the tsunami, if it was a bomb or an asteroid but WAS GIVEN A SPECIFIC TIME, IN FOUR MONTHS!
The second dream was given to Richard Mew early last year about war coming to America on “3/15/1” with 12 nukes hitting 12 cities. He was waiting for it to happen last year and when it didn’t happen he determined the strange date given with “1” meant in one year or this coming Wednesday, March 15.
Also, Turkey and Syria were recently hit my a huge earth quake with 30,000 deaths. This could easily be part of the sixth seal of Revelation which includes the “great day of the Lord’s wrath”, Rev.6:17. The pre-wrath rapture Christians have said for years that this is when the Tribulation starts in earnest.
If a devastating tsunami hit America it would be a perfect opportunity for Russia and China to attack and invade. Isn’t it interesting these two prophecies are coming at a time when the well informed people of this site are already on the edge of their seats?!
+2 #Rothschild — overthedam2023-03-11 17:21
Is some entity pulling a Rothschild maneuver? For example, Peter Thiel and some of his Venture Capital buddies.
+4 #Where did the $42Billion Go??? Jamie Dimon has it! He bled SVB for his own Profit! — watchmann2023-03-11 16:58
Prominent venture capitalists advised their tech startups to withdraw money from Silicon Valley Bank, while mega institutions such as JP Morgan Chase & Co sought to convince some SVB customers to move their funds Thursday by touting the safety of their assets.
Let us get this straight: the largest US commercial bank was actively soliciting the clients of one of its biggest competitors, and the 16th largest US bank, knowing full well deposit flight would almost certainly lead to the collapse of a bank which courtesy of fractional reserve banking, had only modest cash to satisfy deposit demands: certainly not enough to meet $42 billion in deposit outflows.
Of course, Jamie, who has suddenly emerged as a key figure in the Jeff Epstein scandal alongside Jes Staley, knows this, and would be delighted with an outcome that kills two birds with one stone: take his name off the front pages and also make JPMorgan even bigger. Actually three birds: remember it was JPM that started that “Not QE” Fed liquidity injection in Sept 2019 when the bank “suddenly” found itself reserve constrained. We doubt that JPM would mind greatly if Powell ended his rate hikes and eased/launched QE as a result of a bank crisis, a bank crisis that Jamie helped precipitate.
And while we wait to see if Dimon’s participation in the Epstein scandal will now fade from media coverage, and whether Powell will launch QE, we know one thing for sure: JPM was a clear and immediate benefactor of SIVB’s collapse because in a day when everything crashed, JPM stock was one of the handful that were up.
Well if true, we know what the new Bank Name will be announced on Monday: JPMorgan Chase.
No doubt the FDIC had already approached Jamie Dimon to take over SVB, and then Dimon just let the cat out of the bag, big time. So…..it would be only RIGHT for Dimon to also pick up all of SVB’s deteriorating assets as well as their profitable ones.
Disgusting.
+6 #Gasp ! — SBGlett772023-03-11 16:35
Probably one of the most significant things you have written all year:
China orders its Finance Ministry to sell its US Treasuries at “fastest pace.”
This is China cutting their losses on what they see as a coming bond collapse. True, the large sales will hurt prices, but not as much as a money-printing binge by the U.S. ! BUT the large sales will also raise interest rates on UST to nosebleed levels, FORCING the US gov’mint and Fed to print money to completely monetize debt, and cause instant hyperinflation.
+4 #T-Bills: Zero Bids — Loki2023-03-11 18:56
Yes, and even more so last week’s bid on 10 year Treasuries at 4.005% had ZERO BIDS.
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