Latest SVB collapse: Silicon Valley bank share sales come under scrutiny as Credit Suisse predicts

Biden says Silicon Valley bank managers will be fired

Wall Street opened higher on Tuesday as inflation data met expectations and regional bank stocks rebounded after Monday’s sharp declines in the wake of the collapse of Silicon Valley Bank (SVB).

Six regional financial institutions are still tightly regulated, but the regulators’ response – deposit protection – may have addressed market concerns for the time being.

Meanwhile, the US Securities and Exchange Commission and the Department of Justice have reportedly opened investigations into the failure of SVB and any stock trading by the department in the run-up to Friday’s closing. A class action lawsuit has also been filed against the parent company, the CEO and CFO, by the investors.

In other news, a Wall Street expert best known for predicting the 2008 failure of Lehman Brothers pegged Credit Suisse as the next major bank poised to collapse.

Robert Kiyosaki made his latest forecast just hours before the Swiss-based bank admitted there was a “fundamental weakness” in its internal controls over financial reporting and said it had yet to stem customer outflows. Shares in the bank fell after the annual report for 2022 revealed a loss of $8 billion.


She filed a class action lawsuit against Silicon Valley Bank and its principals

A class action lawsuit has been filed against Silicon Valley Bank’s parent company, CEO and CFO, alleging that the company did not disclose the risks that future interest rate increases might pose to its business.

A class action lawsuit has been filed against a Silicon Valley Bank parent

A class action lawsuit has been filed against Silicon Valley Bank’s parent company, CEO and CFO, saying the company failed to disclose risks that future interest rate increases could pose to its business.

Oliver O’ConnellMarch 14, 2023 16:32


Warren: Powell should recuse himself from the SVB probe

Democratic Sen. Elizabeth Warren on Tuesday called on Federal Reserve Chairman Jerome Powell to recuse himself from an internal review of recent bank failures, saying his actions “contributed directly” to them.

In a separate letter, Sen. Warren pressed former Silicon Valley bank CEO Greg Baker for details about the bank’s lobbying in favor of a 2018 law that eased regulations for large regional banks, which she and others noted were contributing to the bank’s collapse on Friday. . It also requested information regarding any stock sales by executives or bonuses paid in the months prior to its failure.

The Federal Reserve said on Monday that it is reviewing its supervision of the bank in the wake of its surprise failure on Friday. Senator Warren argued that Powell’s past support for easing the Bank’s rules indicated he should not be involved in the review. Fed Vice Chairman Michael Barr, who was nominated by President Joe Biden, is leading that review.

Fed Chair Powell’s actions directly contributed to these bank failures. “For the credibility of the Fed’s investigation, Powell must recuse himself from this internal review,” she said in a tweet.

“It is appropriate that the Vice President of Oversight Barr has the autonomy necessary to do his job,” said Warren, a Democrat who has been a vocal critic of Powell.

Oliver O’ConnellMarch 14, 2023 16:12


Banks shed SVB instant infection fears

US bank stocks posted sharp gains on Tuesday, recovering from lows triggered by the collapse of Silicon Valley and Signature Bank, which prompted President Joe Biden and other global policymakers to seek reassurance.

Concerns about contagion risks from the collapse of the two US banks exacerbated investor concerns about the impact of higher interest rates on lenders, hurting bank stocks in Asia and Europe as investors re-examined their risks.

The credit risk index of the eurozone banking system hit its highest level since mid-July, while rating agency Moody’s downgraded its outlook for the US banking system to negative from stable to “reflect the rapid deterioration in the operating environment.”

Although the VIX volatility index, Wall Street’s “fear gauge”, neared a six-month high overnight, US regional bank stocks rebounded, with First Republic Bank rising 52.7 percent, a day after hitting a record low in over Today at $17.53.

“If we don’t see any high-profile failures in the near future, fears will subside,” said Jack Ablin, chief investment officer at Cresset Capital.

Banking giants Citi, Wells Fargo and JP Morgan were also higher in the premarket.

However, Moody’s said it was reviewing six banks for a downgrade, including First Republic, Zion Bancorp, Western Alliance Bancorp and Comerica.

Oliver O’ConnellMarch 14, 2023 15:50


Watch: Democratic congressman gives clearest explanation of SVB’s functioning

North Carolina Democratic Congressman Jeff Jackson has been widely applauded for posting this two-and-a-half-minute video on Twitter and TikTok that vividly illustrates the Silicon Valley bank situation.

Oliver O’ConnellMarch 14, 2023 15:35


Ah, yes, being “awake” brought down a Silicon Valley bank…of course!

The Silicon Valley bank’s historic failure is likely the result of a host of compounding factors unrelated to its so-called “volatility,” from cutbacks under Donald Trump to regulations put in place during the recent financial crisis to the bank’s indefensible focus on exploding. Venture capital firms and technology startups as it becomes a reality, interest rates skyrocket and panic.

Oliver O’ConnellMarch 14, 2023 15:25


After a backlash against the Trump administration, Pence blamed Biden for the failure of the SVB

Former Vice President Mike Pence has joined the chorus of conservative voices trying to blame the Silicon Valley bank collapse on the Democrats while the Democrats try to do the same with them.

In an editorial for Daily MailPence targets Joe Biden and the Democrats, claiming that “just like in 2008,” the party has “increased spending by more than $10 trillion” resulting in “record inflation, which inevitably requires the Fed to raise interest rates.”

He put some of the blame on the bank, which collapsed on Friday, and linked his criticisms with buzzwords in the conservative media.

Greg Graziosi Reports about the comment of the former vice president.

Oliver O’ConnellMarch 14, 2023 15:05


The report says the Justice Department and the Securities and Exchange Commission will verify stock sales before the Silicon Valley bank collapse

Oliver O’ConnellMarch 14, 2023 14:50


The market continues to rise

The market rally continues in New York with the Dow Jones Industrial Average up 419 points (1.32 percent) as of 10.45am ET.

The S&P 500 rose 1.9 percent, while the Nasdaq Composite rose 2.2 percent.

After yesterday’s brutal beating of the share price of a number of regional banks, many showed signs of recovery today with no signs of further bank operations since the federal government said it would effectively guarantee customer deposits.

Oliver O’ConnellMarch 14, 2023 14:47


White House statement on inflation figures for February

Statement from President Joe Biden in the February Consumer Price Index report

Today’s report shows that annual inflation is down by a third from this summer at a time when the unemployment rate remains near a 50-year low. This is the slowest annual increase since September 2021. I will continue to work to reduce costs for hard-working Americans so they have a little more breathing room at the end of the month.

On that front, I’m pleased to announce today that, in line with my call, Novo Nordisk will cut insulin prices by 75 percent, following Eli Lilley’s action. This builds on the important progress we made last year when I signed into law to limit insulin to $35 for seniors. I urge all other manufacturers to follow suit, and I urge Republicans in Congress to join us and cap insulin at $35 for all Americans.

As I said a long time ago, and as the challenges in the banking sector remind us, there will be setbacks along the way in our transition to consistent, stable growth. But we face these challenges from a position of strength. More than 12 million jobs have been created since I took office and the share of working-age adults in jobs or looking for work is the highest in 15 years. We will continue to make progress in our fight to build an economy from the bottom up and from the middle, rather than from the top down.

At the same time, I will do everything in my power to prevent us from rolling back the progress we have made — including by standing up to Republicans in Congress who threaten an over-the-counter economic disaster in order to secure tax cuts for the rich and big corporations and reckless cuts to the critical programs on which he depends. Seniors and American Families.

Oliver O’ConnellMarch 14, 2023 14:30


More problems for tech as Meta 10,000 cuts another job

Facebook’s parent, Meta, is cutting another 10,000 jobs and won’t fill 5,000 vacancies because the social media pioneer is cutting costs.

The company said Tuesday that it will reduce the size of its hiring team and make more cuts to its technology groups in late April, and then its business groups in late May.

“This is going to be tough and there is no way around that,” CEO Mark Zuckerberg said. “It will mean saying goodbye to the talented and motivated colleagues who have been part of our success.”

Andrew Griffin He has the full details.

Oliver O’ConnellMarch 14, 2023 14:15

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