It’s Donald Trump’s fault, as it always is, was the first reaction from the President and admininstration to the Silicon Valley Bank failure.
A train derails. It’s Donald Trump’s fault. A bank defaults, it’s Donald Trump’s fault.
Last week the President said Donald Trump wanted to defund the police. The border, it’s Donald Trump’s fault.
You know what’s funny about all that? You can fool some of the people all the time who actually believe it.
You can add the always unfair NY Times to the list. This is from them today:
“Under pressure from banks in 2018, Congress passed bipartisan legislation that Donald Trump signed into law shielding smaller banks, like SVB, from more stringent rules. The banks argued that they were so small that they posed little risk to the broader financial system.”
Did you notice the word “bipartisan” in that statement? You see, 13 of 17 Democrats voted for the legislation.
But, it’s Donald Trump’s fault.
And, those changes had nothing to do with this failure. It was poor management by Silicon Valley Bank management. It is the out of control inflation and the brakes the Fed is putting on to control it.
You see, bank deposits are declining and their assets were being reduced.
The policies of the administration. It has nothing to do with Donald Trump. Enough already with that.
If you think Donald Trump is responsible for your higher gas prices, food costs, borrowing rates, inflation and state of the nation, then you differ with this blog today.
Not every publication fell into line with the administration. The normally supportive The Hill wrote this:
“Investors and analysts spent Monday trying to detect if other banks are in similar straits because of unwise investments, poor management, liquidity troubles or a combination of ills as interest rates continue to rise amid the central bank’s assault on inflation. The Federal Open Market Committee meets March 21-22, and market analysts are gauging whether the central bank will pause rate hikes to let things calm down.”
“Experts say SVB collapsed because it failed to manage its portfolio amid rapidly rising interest rates and it had significant uninsured deposits that were pulled out of the bank by its customers when the stress was apparent and communicated on social platforms.”
Why did Signature Bank in New York fail yesterday too?
They bet big in Crypto and you know how far that is down now. When you bet on one thing, you set yourself up to win big or lose it all. Signature management lost its bet.
But Joe Biden says it is Donald Trumps fault.
Let’s end this with a tweet from Larry Summers, the former Secretary of Treasury under President Obama:
“SVB committed one of the most elementary errors in banking: borrowing money in the short term and investing in the long term. When interest rates went up, the assets lost their value and put the institution in a problematic situation.”