[zeestephen]

Re: "The value of older government bonds plummets as the Fed raises interest rates..."

That is very misleading.

The value of an investment grade bond at maturity does not lose value.

The bond value declines ONLY if you try to sell it BEFORE it reaches maturity, and quite often, in recent years, the pre-maturity value of long dated bonds INCREASED when interest rates were low or going down.

I have not seen ANY public information on bond portfolio duration for the banks that failed. "Duration" is the median amount of time before the entire bond portfolio matures.

I have seen zero hard data that the failed banks have substantially longer duration bonds than healthy banks.

To my eye, Silicon Valley Bank, specifically, was the victim of an old fashioned, pure panic, run on the bank.

[EBH]

Uh??? SVB failed because they had to sell those bonds early at a loss of 0.75 on the dollar. Did you miss that part?

[rolling_stone]

svb 3.6 year duration 1.79 % yield
55% of investments in treasuries
march 8th report.
https://s201.q4cdn.com/589201576/files/doc_downloads/2023/03/Q1-2023-Mid-Quarter-Update-vFINAL3-030823.pdf

[lepton]

It’s not only duration, but the proportions of the bank investments subject to this, as well as the disposition of many other investments.

This was a very oddly structured bank, from the viewpoint of its customers, its active investments, and its bond investments.