It’s not often that President Trump is given credit for being prophetic, but it just so happens that he was dead-on with a prediction about the US banking system nearly 3 years before this weekend’s devastating collapse of Silicon Valley Bank happened, which has since left thousands among thousands of Americans in panic mode.
Silicon Valley Bank was seized by the Federal Deposit Insurance Corporation (FDIC) on Friday morning, demonstrating the vulnerability of the banking sector. It underscores the Federal Reserve’s inability to combat inflation through aggressive interest rate hikes that have caused regional banks to collapse.
ZeroHedge reports, an old-fashioned bank run ensued after venture capitalists and others with inside knowledge panicked and withdrew a staggering $42 billion in deposits before SVB collapsed.
Social media was flooded with images and videos of people trying to withdraw money from SVB branches and other SVB-exposed banks on Saturday.
As a matter of fact, as this all unfolds, President Trump predicted in 2020 that his defeat by Joe Biden could mean a “1929 situation” for the economy.
Meanwhile, on Sunday, Treasury Secretary Janet Yellen told CBS’s “Face the Nation” that despite SVB’s collapse, the US banking system remains safe, well-capitalized, and resilient.
The Treasury Department, Federal Reserve and FDIC announced Sunday that Silicon Valley Bank customers would be protected and able to access their money in an effort to shore up confidence in the banking system, according to the Associated Press. Additionally, the bank announced steps to protect its customers and prevent further bank runs.
Since the 2008 financial crisis, Sunday’s actions marked the most extensive government intervention in the banking system.
In Joe Biden’s America, the once-booming Silicon Valley Bank has crumbled, resulting in a devastating bank run of more than $42 billion. But President Trump was right, predicting that a Biden victory could mean a 1929 situation for the economy. The unprecedented government intervention seen on Sunday is simply another example of how the banking system is failing, displaying how incredibly vulnerable it is to collapse in spite of efforts to protect it. Ultimately, this shocking event is just another indication that Trump was indeed correct about the economic damage a Biden administration might bring.
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