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SVB (Silicon Valley Bank) just melted down.
They’d put a bunch of their reserves, their cash, into US Govt. Bonds and mortgages which paid next to nothing.

When interest rates went up on US Treasuries, people took their money out of the bank, to buy US Treasuries since those paid more interest.

So, the bank had to sell some of their bonds to have money to pay their customers.

But since the bonds held by the bank, paid a lower interest rate than brand-new bonds, the bank lost money selling them, making the problem worse.

(Think of it this way. I’m trying to sell you a bond paying 2% a year. But let’s say you can walk down the street and buy bond from someone else, paying 5%. You’ll buy the other guy’s bond, right? Cause you can earn more.

But what if I HAVE to get the money, so I absolutely positively GOTTA sell you my bond paying 2%? Only way I can do it, is charge a lot less for it than the face value.
And if I do that, the value of all my other bonds paying 2% drops too, ‘cause everyone just found out how much I can sell it for.

And thereby hangs a tale.

You’ve heard of the Federal Reserve, right?

The CEO of this stupid bank, was involved with the SF branch of the Federal Reserve.
And also, that 2nd line I posted, one of the US District Courts has a bunch of its money tied up in this stupid bank.