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The Weekly Show with Jon Stewart

Making Cents of SVB’s Collapse With Mark Cuban and Sheila Bair

Wed Mar 15 2023
  • The FDIC was created during the Great Depression to prevent bank runs and still exists today to backstop deposits.
  • Silicon Valley Bank's high percentage of uninsured deposits was a risk that ultimately led to its collapse.
  • The rollback of liquidity goals for banks between $50 billion and $250 billion in 2018 was a mistake, and normal regulation is difficult for these banks to undertake.
  • Dodd-Frank and Glass-Steagall were put in place to prevent situations like Silicon Valley Bank's failure.
  • The current $250,000 cap on deposit insurance is not enough to protect small depositors and businesses.
  • The government should provide emergency insurance for transaction accounts to protect them.
  • Silicon Valley's ethos of risk-taking is undermined by the government's tendency to bail out big tech companies, creating an unfair advantage and a lack of true risk.
  • The bank failure primarily affected large depositors, including some with hundreds of millions of dollars.
  • The failure to backstop foreclosures is a systemic problem.
  • Lobbying against regulators makes it difficult for them to crack down on banks.
  • Trust is the ultimate product for the US banking system, and Congress needs to change laws to make banks more conservative and protect all deposits.
  • Billionaire and millionaire investors have relaxed banking rules, leaving everyday people vulnerable.
  • The moral hazard for incompetent bankers needs to be addressed with accountability and pain felt by those who have performed poorly.
  • The loosening of regulations on stress testing for banks has led to problems being hidden until a bank run occurs.