Within 48 hours last week 2 banks failed--one the 2nd largest in history. But don't worry, citizen!

Within 48 hours last week two good-size U.S. banks cratered.  One of those was the second largest bank failure in U.S. history.

As the ripples widen, the Narrative being pushed by the Mainstream Media is that the two failures are, like, TOTALLY unrelated.  Just a coincidence, citizen.  Nothing to be concerned about.  There is absolutely no "contagion."  

Well at least that's what the market shills at Forbes say.  Here's Forbes:

Thursday’s happenings in bank land unfolded gradually, then suddenly. 

Ah, that explains things.  Wait...don't ALL financial meltdowns seem to happen like that?

By now everyone has heard about Silicon Valley Bank, which had over $40 billion in deposits.  But almost no one heard of the other bank, "Silvergate," which as recently as last September had $11.9 billion in deposits.

Silvergate billed itself as "the" crypto bank.  If you know anything about cryptocurrency that may strike you as strange, since such "currency" doesn't physically exist, so there's no need to put it in a bank, eh?

What the bank's execs meant was that Silvergate loaned money to companies involved in crypto.  The bank began making such loans because a) it was trendy, and b) the loans had higher interest rates, so would bring the bank higher profits--assuming, of course, that they'd be re-paid.

And who would have imagined they wouldn't, eh?  Cuz for years, crypto was the hottest, most wildly successful thing evah!  Crypto founders went from failures to billionaires in six weeks.  Suddenly everyone in crypto was faaabulously wealthy!

But a year ago we began to see the first hints that it was all--as many had noted--smoke and mirrors.  A.k.a. bullshit.

Last September Silvergate had $11.9 billion in deposits.  But in just 90 days depositors withdrew $8.1 billion of that.

Now why do you suppose the depositors did that, eh?  What did they know that federal officials didn't?

Desperate for cash, Silvergate was forced to sell assets,  resulting in a loss of $718 million—more than all of the bank’s profits since 2013.  Wasn't enough.

Now here's where it gets amusing: With that big outrush, the bank's holding company (Silvergate Capital) took $4.3 billion in "advances" (loans) from the Federal Home Loan Bank system.  You'd think that with depositors having pulled out over $8 billion in just 90 days, execs at the FHLB would have been leery about loaning that bank $4.3 Billion.  But of course, when you're a gruberment-chartered agency...you get it.  And if the borrowing bank couldn't repay the loan?  Hey, it wasn't our fault, right?  The execs at the FHLB won't lose a single bonus, cuz gruberment-chartered.  Yay!
 
Sure enough, after getting the $4.3 billion loan, a few days ago Silvergate announced  that it will "wind down operations and liquidate." So what happens to the $4.3 billion the execs at FHLB loaned the bank?

I suspect you already know.

The next day depositors at Silicon Valley Bank pulled $40 BILLION out of that bank, which was quickly closed by the FDIC.  But every Mainstream Media outlet quickly moved to assure Americans that the two closings were, like, *totally unrelated.*  

Wait, maybe that's not *quite* true.

One of the connections is that when the biden regime began spending trillions of dollars on bullshit pork projects, it kicked up the inflation rate.  And when the price of, say, eggs triples in two months, people notice.  So to bring the inflation-caused spending down, the Federal Reserve began raising interest rates.

Problem is, when interest rates rise, bonds bearing lower rates are worth less, so banks that had billions in government T-bills were forced to mark down the value of those assets.

Oh, wait: there's a special loophole called "Statement 115," which says that banks that "intend to hold [bonds] until maturity" don't have to mark 'em down.  Wow, that's quite a good loophole, dontcha think?

And of course if a bank is *forced* to sell T-bills, then the fact that the bank didn't write down the value would be moot, eh?

So as noted above, dat some good loophole.

And there was and is another big problem: far too many companies that have borrowed heavily used the funds to buy crypto, or loaned the proceeds to "investors" who used the money to buy crypto.  So when crypto companies began to go bankrupt in April of last year, banks got stiffed on those unrepaid loans.  And the ripples are just beginning to be felt.

Forbes:
>>In the single trading day between Silvergate’s liquidation announcement and Silicon Valley Bank’s [forced asset] sale, traders sold bank stocks across the board. SVB Financial shares dropped 60% in a day. PacWest Bancorp and First Republic Bank dropped 25% and 17% respectively.

But don't worry, citizen!  There is absolutely NO "contagion."  Everything's fine!  In fact, the economy is doing SO well that the biden regime is absolutely flooded with tax revenue.  Yes, they're also gonna raise taxes, but just a little.  You probably won't even notice it.

So Joe's advisors say whatever you do, keep spending, keep buying bank stocks, keep giving money to the Uniparty.  All the "cool kidz" in California are carrying credit card balances approaching six figures, cuz they know that if you get laid off from Fakebook or Apple and can't make your payments, you just declare bankrupcy and the debt vanishes!  

Is that great or what?

Also, the Media are wetting themselves over the faaabulous performance of biden's solicitor-general (for young Americans that's the top attorney for the government) in defending biden's plan to "cancel" (the new, approved media term) student loans up to $20,000--recently argued in the Supreme Court.  And if the Media loved her performance, it probably means the Court will get the hint and declare that "cancellation" perfectly constitutional.  So you can count on that, eh?

SO...all is well in Democrat-land.  Sleep well, citizens.