SVB Crash Will Slam California State and Local Budgets
Commentary
We’re still early in the Silicon Valley Bank crisis. But one thing it will hurt is California’s state and local budgets. And not just in the short term, but the long term.
Banking crises come and go. But what’s different this time is what was advanced by Shark Tank judge Kevin O’Leary and in a New York Times column. O’Leary on March 13 said on CNN:
“But what effectively happened over the weekend is that [President Biden] nationalized the American banking system. It’s no longer a risk. It’s no longer private in any sense. It is now backstopped by the government and ultimately the taxpayer. So it doesn’t matter how bad you are as a bank manager. A good example is what happened to Silicon Valley Bank. That was a combination of a negligent board of directors and idiot management. That’s a very powerful cocktail when put together, and it completely wiped out that bank. And that’s what should have happened….