The Collapse of Silicon Valley Bank

M ben Menachem. Under historically normal banking conditions and regulations, banks operate under a system called “Fractional reserves banking” — which means that a bank must retain a percentage of their depositor’s cash at hand at all times, and can only invest or lend out the remainder.  Historically, for the past several decades, this reserve has been about 9%.  That is, they were allowed to invest or lend 89% of the cash entrusted to them.  On 15 March 2020, the new Biden Admin changed this policy to 0%.  As far as I am aware, this was unprecedented.  It took just the relatively ‘mild’ pressure of rate hikes to cause banks to begin to collapse, as anyone with ANY knowledge and experience predicted.  In other words, the Biden admin caused this, knowingly and with maximum malice aforethought.

A Black Weekend for Israeli High-tech After SVB Collapse:  Sagi Cohen and Corin Degani, Haaretz, Mar 12, 2023

Bank Tank: SVB Debacle Presents Painful Lessons For Israeli High-Tech: Sophie Shulman, C Tech, Mar.12, 2023

Israeli Institutional Investors Exposed to SVB: Roi Weinberger, Globes, Mar. 12, 2023

The Collapse of Silicon Valley Bank: Causes and (Possible) Consequences:  Andrew Stuttaford, National Review, Mar. 11, 2023