Free Republic

Rising interest rates, the remote work trend, and the dominance of e-commerce sellers have combined to hammer the commercial real estate market over the past few years. Sky-high office and retail space vacancies are plaguing owners in this new environment, rents are plummeting, and borrowing costs have soared. As a result, U.S. commercial real estate prices have fallen 11% since the Federal Reserve began raising interest rates in March 2022, the IMF reported last week, the worst decline in over 50 years. The outlook for the sector is now so bleak that Cantor Fitzgerald’s billionaire chairman and CEO Howard Lutnick...

Billionaire investor Bill Ackman says the US government should consider a "highly dilutive" bailout of Silicon Valley Bank amid jitters about its financial position. The bank's failure "could destroy an important long-term driver of the economy as VC-backed companies rely on SVB for loans and holding their operating cash," Ackman said in a series of tweets on Thursday. "If private capital can't provide a solution, a highly dilutive gov't preferred bailout should be considered," he said.

The FDIC has accidentally released a list of companies it bailed out for billions in the Silicon Valley Bank collapse A document from the Federal Deposit Insurance Corp., which the agency said it mistakenly released unredacted in response to a Bloomberg News Freedom of Information Act request, provides one of the most detailed glimpses yet into the bank’s big customers. BY Lizette Chapman , Jason Leopold , AND Bloomberg June 23, 2023 10:43 AM EDT Silicon Valley Bank headquarters in Santa Clara, California Silicon Valley Bank headquarters in Santa Clara, California Philip Pacheco/Bloomberg - Getty Images When federal regulators stepped...

Sen. Bernie Sanders has blamed a Trump-era banking law for the Silicon Valley Bank's failure. "Let's be clear. The failure of Silicon Valley Bank is a direct result of an absurd 2018 bank deregulation bill signed by Donald Trump that I strongly opposed," Sanders wrote in a statement on Sunday. Sanders was referring to the Economic Growth, Regulatory Relief, and Consumer Protection Act, which former President Donald Trump signed into law in May 2018.

The largest financial institutions deemed systemically important are expanding even more during the 2023 banking crisis, leading to greater systemic risks, according to economists who spoke to the Daily Caller News Foundation. These developments and future ones will cause more consolidation in the sector. “Increasing the concentration in the banking industry simply increases the systemic risk,” E.J. Antoni, research fellow for Regional Economics at the Heritage Foundation’s Center for Data Analysis, told the DCNF. “There were already concerns about concentrations of deposits in the banking industry, both because a few firms already held such a large portion of the deposits...

Somehow, Warren Buffett believes that the federal government should cover all depositors, no matter how rich they are, even though the FDIC specifically states that it covers only $250,000, and that is what it charges insurance premiums on. Underwriting risks seems to be a foreign concept to Buffett. Warren Buffett said Saturday that it would have been "catastrophic" to let any Silicon Valley Bank depositors lose their money when regulators seized the troubled California lender.The fall of Silicon Valley Bank on March 10 triggered panic across the financial system. In a bid to restore calm, US officials made the controversial...

New York City teachers, cops and firefighters lost nearly $30 million in pension funds tied to the collapse of Silicon Valley Bank. Critics accuse Comptroller Brad Lander, who is custodian of the pension systems, of favoring the “woke” bank over shareholders. Five city pension funds had a total of $41,867,214 invested in the doomed bank as of Jan. 31, according to data provided by the comptroller’s office under a Freedom of Information request by The Post. The comptroller’s Bureau of Asset Management oversees the investment portfolios. Among the largest funds left holding the bag were the Teachers Retirement System, which...

Perfect storms occur in batches. It's never a single event, a single wave. Bank execs, like ship captains, earn their keep during times of upheaval, in the storm. The good ones have insights that shine by anticipating events, examining cause and effect, assessing risk, and charting the best course through rough seas. Silicon Valley Bank grew deposits by $100 billion in a year and a half. That is the first wave in a perfect storm. The problem or opportunity originated from easy money with which the Federal Reserve flooded the economy (printing $9 trillion via Quantitative Easing). SVB depositors were...

There is a serious problem with the homogenized nature of cybersecurity professionals, Trellix CEO Bryan Palma said during his keynote at the RSA Conference. An overwhelming majority of individuals in the cybersecurity field identify as straight, white, and male, according to a recent Trellix-commissioned survey conducted by a market research firm. This clear lack of diversity is holding the industry back in two main ways. “First, we are turning away great people and doing our industry a significant disservice by failing to cultivate a more inclusive environment,” Palma explained. “We are all better when we benefit from the diverse perspectives...

BlackRock Inc. on Tuesday fetched prices of about 85 cents to 90 cents on the dollar for the first batch of assets sold out of $114 billion seized by regulators last month after the failures of Silicon Valley Bank and Signature Bank. The first list, a roughly $292 million parcel of agency mortgage-backed securities with coupons of about 2.5% to 3%, rolled out before noon Eastern time, according to Empirasign, a platform that tracks trading activity in mortgage bonds and securitized products. “The reality is that the whole point is for BlackRock to get rid of these assets,” said David...

When Silicon Valley Bank (SVB) suddenly collapsed in the second-largest bank failure in U.S. history, many startups and their VC backers focused on sustainability and tackling climate change sprang into action to secure their funds. Federal financial regulators soon stepped in to guarantee deposits, but tighter lending conditions from the banking crisis and higher interest rates pose new challenges for climate tech companies at a time when there's not much time to act and avert the worst effects of climate change. “There is a massive hole in that slice of the climate capitalization pie that's missing," Sophie Purdom, climate tech...

The collapse of Silicon Valley Bank is expected to cost the Federal Deposit Insurance Corp.’s deposit insurance fund roughly $20 billion, the agency estimates, while Signature Bank failure will cost about $2.5 billion. The bulk of those costs relate to covering deposits at the two banks that exceeded the standard federal deposit-insurance limit of $250,000, FDIC chair Martin Gruenberg said in Congressional testimony this week. The FDIC in May will propose a special assessment on banks to repay the insurance fund’s losses stemming from the uninsured deposit coverage, Gruenberg said in his testimony. The proposal comes amid a longer-term debate–predating...

Overall, JPMorgan Chase is telling us that the “most vulnerable” banks in this country have “lost a total of about $1 trillion in deposits since last year”…

A top Federal Reserve official told Congress Tuesday that Silicon Valley Bank (SVB) failed because it didn't effectively address problems raised by the Fed as early as November 2021. "SVB's failure is a textbook case of mismanagement," said Federal Reserve Vice Chair of Supervision Michael Barr. He listed the factors that led to its failure, noting its concentrated business model, with clients in the technology and venture capital sector. [articles all over the financial news this week, including Rooters, WallStJournal, CNBC, WashCompost, etc]

Within days of Silicon Valley Bank’s swift and shocking collapse, a narrative formed that “wokeism” lay at the heart of the California bank’s sudden demise. It began with a Fox News appearance by Home Depot co-founder Bernie Marcus."I feel bad for all of these people that lost all their money in this woke bank,” Marcus told host Neil Cavuto. “You know, it was more distressing to hear that the bank officials sold off their stock before this happened.”Similar criticism followed from rank-and-files members of the GOP, including House Oversight chairman James Comer, who decried SVB’s “ESG-type policy and investing.”The charges...

Peter Schiff appeared on Real America with Dan Ball to talk about the bank bailout, the unfolding financial crisis, the Fed and inflation. He said this is a sequel to 2008 and like all sequels, it’s going to be worse.Dan started the interview by referencing Sen. Elizabeth Warren’s assertion that the failure of Silicon Valley Bank and Signature Bank was caused by “deregulation.” Peter said this deregulation “exists in the fantasy of her mind,” and pointed out that banking is one of the most heavily regulated industries in the world.It would be much safer if it was regulated by free...

In the wake of the current wave of bank failures, one of the startups I currently work with — a Silicon Valley Bank (SVB) customer — recently applied to open an account with a major money center bank. The bank came back with a long list of objections and ultimately declined to open even a basic banking account. Reasons given were: the startup was not 100% U.S. owned, had a foreign-born CEO, and had a senior manager residing outside the U.S. The startup was denied even though it is very well capitalized with a CEO residing in the U.S., has...

I’ve been in Buenos Aires, Argentina, for the last month, including through the recent turmoil in the banking industry in the United States and Europe. It’s a coincidence that has, um, given me some things to think about. For those unfamiliar, the ways people in Argentina navigate the day-to-day economy can sound wild. When you don’t think you can trust the bank, the currency, or anybody in charge, things can get pretty weird pretty fast. Amid super-high inflation, people can’t bet on the value of the Argentine peso staying stable, so when they’re paid in them, they spend them fast...

Here comes the panic. Bloomberg just reported that Treasury Secretary Janet Yellen – who was singlehandedly responsible for stoking and restarting the bank crisis on Wednesday which until that day was easing back, with her comments that nobody in charge was even talking about a uniform deposit insurance, let alone working on one – will convene the heads of top US financial regulators Friday morning for a previously unscheduled meeting of the Financial Stability Oversight Council. The meeting will be closed to the public, the Treasury Department said in a statement. The Treasury didn’t say what time the meeting would...

Wokeness has replaced competence and merit across the banking sector, and San Francisco Fed Chief Mary Daly is the poster child of this pernicious trend. A protege of Treasury Secretary Janet Yellen and short-list candidate for Federal Reserve vice chair, Daly was supposed to be supervising Silicon Valley Bank but apparently was too busy playing politics and pushing woke agendas to regulate rogue banks like SVB, the second-biggest bank failure on record. ... Daly missed all the warning signs of runaway inflation, which led to the steep interest-rate hikes that made SVB’s investments worthless. ... she said inflation didn’t affect...