Biden Banking Crisis Resets
March 14, 2023
By James Grundvig, American Media Periscope
Banks don’t lend money. They purchase securities.
When Silicon Valley Bank (SVB) suffered a short-lived run last Thursday, the feds had to step in and shut down the bank on Friday. With a 185:1 debt-to-asset ratio, with the three main executives dumping stocks weeks before in an insider trading scheme, and with senior executives receiving six-figure bonuses the day before the collapse, federal regulators had no choice but to shut the operation down.
While SVB executives were lining their pockets on the West Coast, in its New York City branch the managers had to call the police to physically remove irate investors and startup CEOs from the premises. The bank run “drained a quarter—$42 billion—of SVB’s deposit in hours, leaving it with a negative $1 billion in cash,” according to Zero Hedge.
As the 18th biggest bank in the United States with $212 billion in assets, before closure, and the second biggest bank failure in U.S. history, there is more, a lot more to Silicon Valley Bank’s (est. 1983) failure than meets the eye.
Biden’s Banking Contagion
Joe Biden is incompetent, old, long past his expiration date, and barely able to read the teleprompter, and none of those traits instill confidence. His obligatory “calm the markets” speech on Monday did little to boost morale in the financial markets. Walking away from the podium when the Q&A session began was an exclamation point to his failed leadership.
No, the U.S. railroads with all of the train derailments are not “safe.” No, the Covid-19 bioweapons, mislabeled vaccines, are not “safe and effective.” And no, the U.S. financial markets are not “safe” either. They are far from safe. And this is just the beginning.
The banks’ contagion spread over the weekend.
First, on Friday, Wells Fargo failed to make tens of thousands of direct deposits on behalf of its companies, affecting millions of depositors, followed by an odd e-cast a note to its depositors that their bank account balances might not reflect reality or be accurate. On Sunday, the one-two punch came.
The FDIC, which took receivership of SVB, started an auction on the bank’s assets. Then, the regulators moved in and shut down “crypto-focused” Signature Bank (est. 2001) in New York City, with $114 billion in assets.
By Monday morning the wheels broke off the confidence game. The New York Stock Exchange halted trading 30 times on bank stocks to prevent a much larger run on the banking sector, preventing vulture funds from “shorting” the banks. First Republic Bank (est. 1978) also fell victim losing 60 percent of its value for the wealthy clientele-driven bank. When will the regulators step in and close its doors?
Yet another bank, Western Alliance Bancorporation (est. 1995), with ties to Silicon Valley Bank, could be the fourth failure to occur this week.
Amid all of the whirlwind, head-twisting runs and rumors, the Federal Reserve stepped in to ensure that all depositors would be backstopped in the SVB collapse.
Still, the financial overhang on the markets is Joe Biden’s ice-shelf of his whopping tax proposal with a $6.8 trillion budget and massive tax hikes. Announced a day before the SVB bank run and Signature Bank failure to fall three days later, it’s hard to talk about a “confidence” game when the $6.8 trillion will be revised northward to include the $500 billion needed to bail out the banks listed above.
This is not the end of the banking crisis. It is the beginning.
Stark Differences From the 2008 ‘Great Recession
On Tuesday morning, as of this writing, the financial markets calmed down Bloomberg News and other business shows changed the narrative to CPI and the overall health of the economy, with less coverage on the historic banks’ failures. Asia appeared calm. European markets started the day the same. It was back to business as usual.
There are systemic problems and undercurrents in the structure of the banking system, however, that needs to be addressed, that were never resolved post the 2008 Crash, and that printing money or raising taxes can’t resolve.
- The collective global debt is $300 trillion
- The global GDB is $100 trillion
- The true global debt rises above a couple of quadrillion dollars when factoring in outstanding derivative contracts, social programs, and other unfunded liabilities that socialist governments have pushed and promoted the past half century.
We know those obligations, contracts, and liabilities will never be paid back. Ever. So, is it any wonder why Klaus Schwab, his World Economic Forum, the United Nations, the IMF, and World Bank want to “reset” the global economy by engineering its demolition?
What better way to hide their financial crimes, wealth transfer from the people, and the outright theft on the working man’s money.
As such, the financial pundits who mislabeled the start of this banking run as “Lehman 2.0” or that this outbreak is now contained will be in for a major shock when the entire financial system implodes at some point this year.
What makes 2023 far different than any other recession or depression-era year in the past is its massive size and unaccounted variables not seen before.
Neither the start of the Great Depression in 1929, or 1987 “Black Monday,” or the 2000 Dot Com Bubble burst, or the 2008 Fixed Income Crash will serve as historic precedents on how to deal and contain these issues or challenges.
- None of those years suffered a global pandemic
- None of those years mandated the lockdown of businesses
- None of those years mandated a global vaccine program
- None of those years printed trillions of dollars in response to containing a pandemic
- None of those years are suffering a contraction in employment, due to the mass die-off and disabling of millions of working professionals by the Covid injections.
Finally, 2023 is the end of the line of the modern era system of globalization. With food scarcity and arson attacks on more than 100 food plants, with supply chain disruptions, with the U.S. dynastic families offshoring the U.S. manufacturing base to Communist China, starting in 1972, with Bidenflation exploding skyward, the next one or two Federal Reserve rate hikes will all but kill the U.S. economy.
Add today’s calculation for Consumer Price Index (CPI), which excludes food and energy, items we consume every day, the real inflation number jumps to ~20 percent.
The Biden regime has no answer to fix any of these substantial, plate tectonic issues or change their trajectories.
Big Tech Going Small Fast
Often it takes a crisis to uncover nefarious operations, such as money laundering or money for technology swaps, and expose corruption. Both SVB and Signature Bank’s collapse revealed their ties to Communist China, the dark pools of cryptocurrencies, and the too-easy money for tech startups to fail and launch. Before the collapses of the banks, several venture capitalists foresaw 2023 as being an “extinction-level event” year for startups.
Yesterday, Meta (aka Facebook) announced it was leaving the NFT market for Facebook and Instagram. This comes on the heels of Meta also announcing a second round of ten thousand layoffs.
Sound economy, right Joe Biden? Everything is “safe.” In another part of the crypto space, SVB broke the fictitious dollar peg between Tether’s stablecoin of USDT and the U.S. dollar. That’s bad news and it should question the so-called stability of the stablecoin model moving forward.
What so many crypto advocates and “holders” fail to realize, is that even the biggest crypto exchanges—Binance, Coinbase, Crypto.com, Kraken—all hold collateral in the global financial markets. The majority of those assets fall into three buckets: bonds, stocks, and cash. Some hold real estate. But the point is, they are all vulnerable to a bank run or confidence contagion. Coinbase, among other crypto companies, banked at SVB, while many others at held assets, now frozen, at Signature Bank.
On the surface, the markets have calmed down. The Cat 1 storm is over. But this was a prelude for a much bigger event to come.
The three known geopolitical conflicts that loom on the horizon are Russia vs. NATO proxy war in Ukraine, China-Taiwan, and now the Mid-East getting hot again with Israel and the new alliance of Saudi Arabia and Iran posing a threat.
Throw in BRICS nations breaking away from the U.S. dollar reserve currency and a recipe for disaster has all been baked in with a nuclear conflict to resolve geopolitical differences on the horizon.
When World War III goes kinetic, out in the open expect the global financial markets to respond in kind and barrel headlong into the Cat 5 storm of the “Great Reset.”
Who’s reset will it be is the only question that remains.