The week begins with the eyes of the world turned to the United States, still reverberating the biggest failure of an American bank since the 2008 crisis.
Last Friday (10), the main bank for US technology startups, Silicon Valley Bank (SVB), quickly dissolved, leaving its customers and investors in limbo. The collapse led to the acquisition of the company by federal regulators the Federal Deposit Insurance Corporation (FDIC), and fears that the bank’s failure could infect the banking system.
Therefore, the expectation this Monday (13) is regarding President Joe Biden’s speech, after a second bank – Signature Bank – was closed by New York regulators.
The US government has guaranteed that SVB customers will have access to the money from all deposits starting this Monday. According to the Federal Reserve (Fed, the US central bank), the Treasury Department and the FDIC, the idea is to protect the economy.
The SVB has provided funding for nearly half of venture capital-backed US technology and healthcare companies. Founded in 1983, it is relatively unknown outside of Silicon Valley, but it was among the top 20 largest commercial banks in the US, with more than $200 billion in total assets last year.
One of the reasons for the bank’s failure can be explained by the high interest rates, which constrained technology companies, made it difficult to raise funds and reduced the sector’s stock values. Faced with high interest rates, the loss of IPOs and a shortage of funding, the bank’s customers began to withdraw money.
Most analysts, however, guarantee that this is an isolated issue for the SVB — not yet a banking crisis.
In Brazil, with a week to go before the meeting of the Monetary Policy Committee (Copom) of the Central Bank (BC), the expectation is that the Minister of Finance, Fernando Haddad (PT), will present to President Luiz Inácio Lula da Silva (PT) the model for the new fiscal framework later this week.
Presented by Muriel Porfiro, the CNN Money it presents a balance of the news subjects that influence markets, finances and the direction of society and the dynamics of power in Brazil and in the world.
*Posted by Tamara Nassif
Source: CNN Brasil
I’m James Harper, a highly experienced and accomplished news writer for World Stock Market. I have been writing in the Politics section of the website for over five years, providing readers with up-to-date and insightful information about current events in politics. My work is widely read and respected by many industry professionals as well as laymen.
