BANK-RUN RISKS: CHINA, RUSSIA, INFLATION, THE FED, BOTS & SHORTS
A QUICK REVIEW
THE BANKING CRISIS
THE FED IN CONTEXT
THE FED’S REAL JOB: UNEMPLOYMENT AND INFLATION
US INFLATION RATE
UPCOMING EVENTS MEMBER SPOTLIGHT: WILLIAM JANEWAY ETHERMAIL
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Author’s Note: I would like to thank our many friends for their warm welcomes and offers of partnership during our time last week in Basel, Zurich, Zug, Schaffhausen, and Hamburg. SNS and FiRe have always been strongly international, and this only becomes truer with an increasing number of great members in these vital new growth centers. We look forward to having many new international colleagues joining us, onstage and off, at FiRe 2023. – mra
Why Read: Most everyone is concerned at the ongoing drumbeat of bank failures, without a clear metric regarding what’s behind them. This lack of understanding has created an aura of financial uncertainty which, in and of itself, can cause further damage to the system. This week’s issue explores the public causes given, their likelihood of being incomplete or incorrect, and additional factors not faced by the system in prior decades. Finally, it places the Fed’s role in all of this in a more pragmatic perspective, regarding both cause and response.
[See “SNS: Manufacturing Inflation,” 6/14/22]
In this week’s discussion, we are going to question some of the current media narratives regarding the runs against and subsequent recent failures of Silicon Valley Bank, First Republic Bank, Signature and Silvergate banks, and others.
Let’s start with the last two, the obvious outliers. Banks doing a majority of their business with crypto firms are guaranteed to fail; if any are left, please close them all today. The collapse of FTX just hastened the inevitable. No future banks should be chartered or allowed, worldwide, of this nature.
