The Fed's 'Bailout' of Silicon Valley Bank

Main takeaways

Fed is “prepared to address any liquidity pressures that may arise” - workaround for unrealized losses and the fed saw potential systemic risk

"The Fed is explicitly trying to tighten financial conditions, but also has responsibilities to promote a stable banking system. A liquidity facility for banks that ignores losses from rate hikes is uniquely positioned to walk that line." - Steven Kelly

The $250K deposit insurance cap is not really useful anymore

It's kind of a bailout

00:00 - Intro
00:09 - How Money Works
00:42 - How Banking Works
01:47 - SVB Update
04:38 - Whats Next?

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[KylaScanlon]

thanks for watching everyone! notes and citations (please note, i am quoting a lot of sources here) in document in caption

[ChiraagLathia]

Was waiting for this one!! Thanks for the quick upload Kyla

[Strikervideos]

Meanwhile I just keep flashing back to a year and a half ago, when a family friend of mine who is in the C-suit of a biotech company said she felt like she could walk into a VC, make up an idea on the spot, and walk out with $5 million in Series A because no one there knew what the heck she was talking about. They just heard “cancer” and “potential cure for” and nodded.

[xvx]

I can't wait until 10 years from now when Kyla has her own show on CNBC!

[adrianp]

The one channel I want to turn notifications on

[PrebleStreetRecords]

This might not be the lurch of the merry-go-round stopping, but we’re definitely feeling some grinding in the bearings.
Great video as always!

[eduardorafael]

Does the FED have any resources to punish bad decisions from the executive level? Jail? Refund everyone but the people in charge of this mess?

[WBF_III]

Best explanation I've heard yet. Thanks, Kyla!

[matthewrichardson]

Thanks for explaining this is so different from the normal regulated banks

[hrzvmzg]

This was so fast, Kyla has been Z O O M I N G this week

[frizzizzi]

I really like the lighting you used in this video! Your eyes sparkle when talking about the Fed raising rates 😂

[Astarath]

once again losses are socialised, gains are executive bonuses

[cooper]

Okay was the "key in the ignition" thing an already existing rap/song cause that sounded pretty good

[randomthoughtsfromacrazedm]

SVB bet on a bailout if things went bad and they bet correctly. They just did not know they were the ones to trigger the bailout.

[BADBOYNOE]

you should do a mic run - great video tho top 5 of your vids

[realbc]

Can we touch on how consumers will be impacted with the Fed's "Special Assessment" on banks? Assuming it will just be passed along in the form of lower interest rates for savers since they need to pay the tax, is that the likely scenario?

[gizzardelectric]

Kyla I'm lost. I thought I understood how rate hikes affected me (a W2 worker, renting, no outstanding debt), but I'm not sure I do anymore.

Could you explain what a VC bank failure means for non-investors?

[cpeterso]

I kind of want to see a 75 basis point hike just to see what happens

[karuonline]

Banks don't loan out deposits...deposits are ONE way banks can fund drawdowns on the loans they issue but they don't depend entirely on customer deposits to make loans...

[jmedaugh]

Do you think a goal of 2% inflation is a bridge too far now? Also were SVB leadership simple idiots or did they expect a backstop if they screwed up? It's like we learned nothing from 2008.