The failures of Silicon Valley Bank, Credit Suisse Group AG and others have gotten financial authorities thinking again about bank runs and liquidity regulations — and whether some rules ought to be tweaked to make the system safer.
Silicon Valley Bank suffered probably the quickest bank run in history and the fastest bailout of depositors, too. The lender to the venture capital industry had operated under lighter rules and fewer restrictions than larger banks after a successful lobbying effort back in 2018.
Stubborn inflation means more interest-rate increases are coming from the Federal Reserve and that sounds like great news for banks.
The health of borrowers is the key concern for all of finance in the coming year.
The $24 trillion US Treasury market has gotten too big for even the “Masters of the Universe.” As the Federal Reserve reverses its bond purchase program and more government securities flood back into the hands of dealers, banks, investors and traders, the chances of extreme, unhealthy volatility are rising.
If everyone feels so miserable, why do they seem to be out having a good time?
Everyone is stressing about consumer debt. Investors have been dropping the shares of big banks, credit-card specialists and younger fintechs because of fears about the pain that rising living costs and interest rates will inflict on borrowers.
It’s easy to be carried away: Top banking regulators are hungry for the efficiency, profitability and better service that pan-European banks could deliver.
Online brokers like Robinhood Markets Inc. and crypto assets might get the headlines, but the Securities and Exchange Commission’s parallel effort to drag private-equity firms and hedge funds out of the shadows will have far more impact on far more lives.
Stand on the steps of The Royal Exchange in the heart of the City of London and you can picture the churn of people 200 years ago or more in what was becoming the world’s preeminent financial hub.
There are so many things to do these days other than be a hard-charging investment banker or trader: Even Goldman Sachs Group Inc. has to offer more than just a ladder to riches to keep its people on board.
People can be just the worst borrowers, failing to pay what they owe especially if defaulting doesn’t cost them their house or their car. That’s why credit cards charge eye-watering interest rates and late fees.
