Will taxpayers foot bill for tech bank collapse?
As it turns out, this misinformation campaign has turned into a massive case of misdirection.
The real financial earthquake occurred unexpectedly, some 10,000 miles from Israel, in Santa Clara, California. America’s 16th largest bank, Silicon Valley Bank (SVB), went belly-up 48 hours after announcing it had run out of money and would be forced to raise more than $2 billion in emergency funding. The next day, nervous depositors withdrew $42 billion in cash, leaving the bank without any funds to cover further withdrawals, which forced federal banking regulators to step in and shutter it before matters could get even worse.
Over the weekend, the US Treasury Department, the Federal Reserve Board, and the Federal Deposit Insurance Corporation (FDIC) worked around the clock to devise measures to protect the remaining bank depositors, most of whom were not insured. Reuters reported that an estimated 89% of the customers, with a total of $175 billion, were not insured under the FDIC’s $250,000 upper limit per account.
This is a developing story, but at press time, federal regulators assured depositors they would have access to their funds on Monday morning, although there were conflicting reports over what percentage of that money would be available for withdrawal, and over what period.
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