Banking crisis: a possible disaster… without the possibility of preventing it!
The bankruptcy of Silicon Valley Bank (SVB) and its subsequent rescue and bankruptcy of Crédit Suisse rightfully raised concerns about the risk of a banking and financial crisis that could be worse than the 2008 crisis.
* facts
On March 10, 2023, Silicon Valley Bank (SVB) went bankrupt in America. This bank is saved by the US central bank (Federal Reserve).
But then panic grips the stock markets. Between Friday, March 10 and Monday, March 13, the assessed value in the stock market of all the world’s banks will decrease by 465 billion dollars. It affects especially in Swiss Credit Bank, which had already suffered losses for two years in the provision of highly speculative loans (Archegos and Greensill). Its main shareholder, the National Bank of Saudi Arabia, announced that it would not participate in any way in the possible reinvestment of the Swiss bank. This case is serious: Swiss Credit Bank is one of the thirty largest global banking groups, which is recognized by international financial authorities as a bank that has “structural” conditions due to its size and the links it has with many customers and creditors. This means that if one of them goes bankrupt, the entire global financial system will be threatened with collapse. Everything important in the global economy passes through these thirty giant banks: financial markets, international trade, multinational operations, tax evasion, public debt management…they concentrate a decisive part of economic power. But, because banks and other financial institutions around the world are constantly lending to and borrowing from each other, they are vulnerable to even limited financial disruptions like the bankruptcy of Silicon Valley Bank. The Swiss central bank must urgently transfer a huge amount of 50 billion dollars to the Credit Bank of Switzerland, and the Swiss and international authorities arranged the purchase of this bank by another Swiss bank (UBS).
Idea Global Media Broadcasting Group,
Cyrus Kongrlu
Quoted from Le Monde Diplomatic
