The colossal failure of the Silicon Valley Bank means that many rich investors won’t get bailed out because the FDIC insures deposits up to $250,000 only. And that is fine with President Biden who refuses to use taxpayer money to cover bigger losses by investors.
“President Joe Biden spoke out Monday morning in an effort to reassure Americans there is no need for panic after federal agencies stepped in following the failures of two big banks over the weekend.
‘Americans can rest assured that our banking system is safe. Your deposits are safe. Let me also assure you, we will not stop at this. We’ll do whatever is needed,’ Biden said from the White House.
The federal government said Sunday that all depositors at Silicon Valley Bank and Signature Bank will be protected and be able to get access to their money Monday morning, with the funds coming from a special fund set up by the nation’s banks and from the sale of the banks’ assets, not from taxpayers.
‘No losses will be borne by the taxpayers,’ Biden repeated in his remarks.
‘Because of the actions that our regulators have already taken, every American should feel confident that their deposits will be there if and when they need them,’ he continued. ‘Second, the management of these banks will be fired. If the bank is taken over by FDIC, the people running the bank should not work there anymore.’
‘Third, investors in the banks will not be protected. They knowingly took a risk, and when the risk didn’t pay off, investors lose their money. That’s how capitalism works. And fourth, are important questions of how these banks got into the circumstance in the first place. We must get the full accounting of what happened and why those responsible can be held accountable,’ he said.”
For the rest of the story, visit ABC News here.
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