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How the US Federal Reserve Can Stop a Repeat of the SVB Collapse

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Editorial Teamhttps://www.xtrempoint.com
Where News Meets Insights, We Keep you Ahead!
Moscow, March 11 – The US Federal Reserve has enough resources to prevent the problems that caused the collapse of SVB Financial from spreading to the entire financial system, although the measures could lead to higher inflation in the country, Anton Tapach, chief economist at Expert RA, commented on the News Agency.
California regulators have shut down Silicon Valley Bank (SVB), the largest bank in the US since the last financial crisis, according to the Federal Deposit Insurance Corporation (FDIC). The FDIC transferred all SVB-insured deposits into a separate structure created by it – the National Deposit Insurance Bank of Santa Clara.
A passer-by near the Silicon Valley Bank office in Santa Clara, California - 1920, 11/03/2023

Experts say that the collapse of the SVB will negatively affect regional banks in the United States

“The Fed has enough resources to prevent the problem from spreading across the sector: banks will give the necessary liquidity, but this could lead to higher inflation,” the analyst said.
In general, Tabakh believes that the event so far is a positive point: the bank was actively playing in the debt market and incurred large losses due to high interest rates. However, it had a mostly corporate client base with uninsured accounts, and once rumors of a bad situation circulated, it took depositors two days to “screw up” the bank, making for a conventional foray.
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