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The recent collapse of Silicon Valley Bank has sent shockwaves through the financial industry. Silicon Valley Bank, which was founded in 1983, is a commercial bank that serves innovative companies in technology, life science, and other knowledge-based industries. It is a subsidiary of SVB Financial Group, a public financial services company that operates in the United States, Asia, and Europe.

On January 7th, 2023, the bank announced that it had failed to find a buyer after holding an auction process. As a result, the bank would cease operations, and the FDIC would take over. This news has raised concerns about the safety of deposits and the potential for contagion to other banks.

In a recent interview with John Carney, the "Breitbart" Economics and Finance Editor, he shared his thoughts on the situation. Carney believes that the Federal Deposit Insurance Corporation (FDIC) will likely announce more bank seizures, but they prefer to do it on Fridays and not in the middle of the week.

John Carney is the Economics and Finance Editor at Breitbart News Network, one of the most popular conservative news outlets in the United States. He is also the co-author of the "Breitbart Business Digest," a newsletter that provides insights into the latest economic and financial news.

Carney has been writing about economics and finance for over a decade and has become a trusted voice in the industry. He has been a contributor to CNBC, Fox Business, The Wall Street Journal, and The New York Times. He is known for his sharp insights and analysis on a wide range of financial topics.

Carney is particularly interested in the intersection of technology and finance. He has written extensively about the impact of technology on the financial industry and how it is changing the way we do business. He has also written about the rise of fintech startups and how they are disrupting traditional banking.

In addition to his work as a journalist, Carney is also a regular speaker at financial conferences and events. He is known for his engaging and informative presentations, and he is often asked to share his insights on the latest economic and financial trends.

Carney also thinks that the FDIC's current plan to guarantee deposits at only two banks is not sufficient. He believes that the FDIC will need to take more action to assure the public that their deposits are safe. He notes that during the 2008 financial crisis, it wasn't enough to artificially manipulate the markets; people demanded that money be put up, and the FDIC and Janet Yellen need to guarantee deposits to restore confidence.

Regarding the failed auction process of Silicon Valley Bank, Carney believes that the risky loan book could have been a contributing factor. He also points out that the regulatory apparatus is standing in the way of allowing the giant banks in the US to buy the bank, making it difficult to find a suitable buyer.

When asked about the Federal Reserve's response, Carney thinks that a half-point rate hike is off the table, and they are now considering a quarter-point increase. However, if the situation with the banks worsens, he believes that the Fed will pause and not announce an emergency cut, as this could lead to a bigger panic.

Carney references former Federal Reserve Chair Alan Greenspan, who cut the funds rate three times in 1998 when Long-Term Capital Management collapsed. However, Carney believes that this was a mistake that helped inflate the tech bubble and ultimately made the consequences of the crisis worse. He notes that the current inflation rate is too high, and a Fed rate cut could make things worse.

John Carney has been the Economics and Finance Editor at Breitbart News Network since 2017. Over the past several years, he has become a trusted voice in the financial industry and has gained a large following due to his insightful reporting and analysis. His work at Breitbart News Network has helped to inform and educate readers on important economic and financial issues, and he has become a respected figure in the field of economics and finance. With his extensive knowledge and experience, Carney continues to be a leading voice in the industry and an important figure in financial journalism.

In conclusion, the collapse of Silicon Valley Bank has raised concerns about contagion and the safety of deposits in other banks. The FDIC and the Federal Reserve will need to take appropriate action to restore confidence and prevent further financial instability. It remains to be seen what actions the FDIC and Federal Reserve will take to address this crisis and what the long-term impact of this collapse will be on the financial industry.

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