BANK RUNS

[Mortblanc]

Almost everyone on this forum is old enough to have lived through, and should well remember, the savings and loan crash of the late 1980s, the tech bubble crash of the late 1990s, the housing bubble crash of the late 2000s,,,,do we see the pattern yet?

We will not even discuss the crash of the late 1970s due to the Arabs gaining control of the world economy. Some of you might not be old enough to remember that one.

Bank failures and bank runs are a subject we have discussed infinitely on this and every other prepper forum since the internet was invented. Everyone here knows the risks of using banks, their strengths and weaknesses.

There should be not a single person here that has any undue risk from any failure of any bank if they have followed the advice of countless posts all over the web. Not to risk what you can not afford to loose, all your eggs in one basket and that sort of thing.

If you do have an account that totals more then the guarenteed amount covered by the government I have no great pity for you. You should have had your money in a place where it was/is earning higher dividends anyway.

Bank runs are the result of human fear and stupidity. Such actions feed on themselves, as they are doing in the present case.

SVB was an institution offered totally as a corporate money management service. The only "individual" accounts in the bank were those of bank employees. The general public had no risk money in SVB and SVB had no influence on private banks other then the possibility of the panic runs of a heard of sheep.

SVB was required to invest excess deposits in the most secure manner possible. That manner was totally secure treasury bonds that had a yield of almost zero. As soon as the FED raised interest rates to higher then the bond yields it threw SVB into instant bankruptcy.

As they tried to sell off the bonds at reduced rates to regain stability their customers shifted their accounts to other banks. The leader of the stampede was the owner of PayPal.

When SVB deposit totals fell below the minimum government guidelines it instantly triggered a shutdown of the bank according to the "safety measures" instituted by the government.

Apparently no one broke the law, no one stole anything. They used the system as it was prescribed and followed the rules. It was the rules that killed them.

They were required to invest short term money on long term assets.

A violation of basic business finance that occurs due to turning over control of your banking industry to the legislative branch, made up of the members of the sheep flock that think they are smarter than the rest of the flock, and computers with instant triggering devices controlled by AI.