What we’re reading (3/16)
“Eleven Banks Deposit $30 Billion In First Republic Bank” (Wall Street Journal). “The biggest banks in the U.S. swooped in to rescue First Republic Bank with a flood of cash totaling $30 billion, in an effort to stop a spreading panic following a pair of recent bank failures. The bank’s executives came together in recent days to formulate the plan, discussing it with Treasury Secretary Janet Yellen and other officials and regulators in Washington, D.C., people familiar with the matter said.”
“Why Barney Frank Went To Work For Signature Bank” (The New Yorker). [Per Frank] “I have read what Elizabeth [Warren], and others, said. I don’t see any argument that there was something that was going on that would’ve been stopped if they had got the same scrutiny as JPMorgan Chase. No one has made a specific connection there.”
“Low Rates Were Meant To Last. Without Them, Finance Is In for A Rough Ride.” (New York Times). “If a number defined the 2010s, it was 2 percent. Inflation, annual economic growth, and interest rates at their highest all hovered around that level — so persistently that economists, the Federal Reserve and Wall Street began to bet that the era of low-everything would last. That bet has gone bad. And with the implosion of Silicon Valley Bank, America is beginning to reckon with the consequences.”
“The Moral Hazards of Banking Keep Increasing” (Morningstar). “No size, it seems, is now too small to fail.”
“Where Did FTX Customer Money Go? Firm Says Bankman-Fried Took $2.2 billion” (Ars Technica). “As summarized by the Financial Times, ‘Bankman-Fried and five members of his inner circle transferred $3.2 billion in total to their personal accounts in the form of ‘payments and loans,’ the funds primarily coming from Alameda Research, a crypto trading hedge fund affiliated with FTX.’ John Ray, the new CEO leading FTX through bankruptcy proceedings, ‘has been seeking to identify the location of cryptocurrency and other assets that can be eventually returned to the millions of FTX customers whose accounts have been frozen since its collapse,’ the Financial Times noted.”
