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At least two of these failures were purely the result of rich people freaking each other out on social media. SVB and First Republic were operating with the full backing of the FDIC, over and above the official limits, and likely could have endured 5% Fed Funds Rates (even profited off them in time) if tens of billions of dollars in panicked depositors hadn’t run on them.
That’s not to say there’s anything structurally sound about any of this shit. But its indicative of how the death blow to these firms is entirely a consequence of the Keynesian Animal Spirits and has nothing to do with the firms’ fundamentals (which were as shit a few years ago as they are now).
What’s really nuts is how JP Morgan is just Pacman-ing these firms, one after another, when its already head and shoulders above everything. I really just have to wonder at the kind of strings a guy like Jamie Daimon can pull at this point. Dude is the closest thing our country’s had to a King since Rockerfeller.
