Dan Davies On What Brought Down Silicon Valley Bank

Odd Lots

Bloomberg

News, Investing, Business, News Commentary, Business News

4.4 • 1.6K Ratings

🗓️ 14 March 2023

⏱️ 38 minutes

🔗️ Recording | iTunes | RSS

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Summary

Silicon Valley bank collapsed at record speed. And the world is still trying to figure out what went wrong? How did a bank with a strong history, a strong brand, and a fairly conservative investment portfolio go belly up so fast? On this episode of the podcast, we speak with Dan Davies, a Managing Director of Frontline Associates, who previously worked as a bank analyst. He explains why the bank's customer base turned out to be so much more flighty than expected, and why the bank reached for yield buying long-dated Treasuries at a time of ultra-low interest rates. We discuss what to watch next, and why he's concerned that the initial salvo to stanch the bank run may not be enough.

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0:00.0	As of 9-1-2023, you may earn a 5.5% annualized yield with 6-month T-bills of hell to maturity.
0:06.4	But who's got time to purchase US Treasuries? Doesn't that involve going to a bank?
0:10.0	Or navigating a government website that looks like it was designed in 1996?
0:13.6	Turns out, you can go to public.com, purchase Treasury Bills in seconds,
0:17.4	and you may be able to earn some of the highest yields we've seen since the year 2000.
0:21.2	Visit public.com slash T-Bill podcast to get started.
0:24.8	This is a paid endorsement by public.com, fees and conditions apply.
0:28.3	Treasury accounts at public.com or through Gico Securities Inc.
0:31.4	Member Finra and SIPC. Full disclosures can be found at www.public.com slash T-Bill podcast.
0:38.0	Are you rich? That's a good question. Is it about what you have in the bank or your 401k?
0:44.1	Should you buy a place where you live or hold off?
0:47.2	And if you build, could San shortages and Singapore impact prices in Connecticut?
0:51.8	At Bloomberg, we see wealth as more than just money.
0:54.8	Our coverage looks at wealth from every angle, so you can make smarter decisions.
0:59.5	Bloomberg wealth. All you need to know about wealth.
1:02.0	Who has it? Who's making it? And how you should think about yours?
1:05.2	Learn more at Bloomberg.com slash wealth.
1:18.4	Hello and welcome to another episode of the Odd Lops podcast. I'm Tracy Alloy.
1:23.3	And I'm Joe Wyzenthal.
1:24.9	Joe a lot has happened in the past few days. I don't even know where to start, really.
1:32.4	Yeah, I mean, I don't either, but I would say, look, the developments I think
1:38.0	related to Silicon Valley bank, the speed of the run and the speed of the response are extraordinary.
	...

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