Victims of the Fed: How a year of rate hikes cratered stocks - and fueled the demise of FTX and Silicon Valley Bank
's price plummeting 39% over the past year. FTX boss Sam Bankman-Fried allegedly responded by using customers' money to prop up his trading firm Alameda Research – and now he's in the US awaiting a criminal trial on eight counts including fraud.
"Although this has been charged as fraud, you can argue that a Fed hiking cycle exposed it, as it reversed the enthusiasm for crypto, which ultimately exposed the corporate wrongdoings at the company," Deutsche Bank managing director Jim Reid said in a research note. Meanwhile, SVB collapsed last week – and rising interest rates were a huge factor in its demise. SVB lost $1.8 billion on its bond portfolio as fixed income prices plummeted, while its deposit base dried up because of tech startups' growing reluctance to list on the stock market.
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Silicon Valley Bank’s parent company files for bankruptcy protectionSVB Securities and SVB Capital were not included in the filing by SVB Financial Group.
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SVB collapse: SVB Financial Group files for Chapter 11 bankruptcySVB Financial Group announced it was filing for Chapter 11 bankruptcy to reorganize under court supervision. SVB Securities and SVB Capital's funds and general partner entities will not be included in the Chapter 11 bankruptcy.
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SVB collapse isn't like '08 and Fed should keep hiking rates: Lisa ShalettThe Fed should keep up the fight against inflation as SVB collapse is not like the 2008 crisis, Morgan Stanley Wealth Management CIO says
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Fed likely to hike rates after SVB failure, says Carlyle's David RubensteinBillionaire David Rubenstein says the Fed will keep hiking in March to show it's still fighting inflation despite SVB collapse
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Banks have borrowed $165 billion from the Fed in past week after SVB failureU.S. banks borrowed almost $165 billion from the Federal Reserve after the failure of Silicon Valley Bank to help curtail a budding financial crisis.
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Banks sought record Fed liquidity in wake of SVB collapseBanks sought record amounts of emergency liquidity from the Federal Reserve over recent days in the wake of the failure of Silicon Valley Bank and Signature Bank, which in turn helped undo months of central bank efforts to shrink the size of its balance sheet, Fed data showed on Thursday.
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