Another ‘Crisis’ In a Completely Different Industry

A bank on a wild financial cruise

As an American public we feel like we have the most secure banking system in the world. A bank may make mistakes on individual accounts, personal or business, we have been pretty confident that when we want to withdraw our cash, it will be available according to industry rules and regulations. There we were driving along in our usual financial cruise. Then it happened. A huge semi crashed into a telephone pole without seemingly making any attempt to swerve or brake! Then, a collection of other somewhat smaller semis crashed into it, also without seemingly hitting the brakes. Now, you would think these highly experienced drivers and their copilots would have taken notice and at least tried to avoid the accident altogether. Traffic comes to a halt and after a few people close enough to the situation call 911, they are told to hang on and help is on the way, and that everyone will be able to pass through in a short while. On the news the media tell us what they want us to hear and see while everything is under investigation.

There were many bright, sunny days at Silicon Valley Bank as the CEO 30 years, Greg Becker, accumulated a powerful social life involving venture capital firm owners and their start up teams. Along the way, SVB went on to accumulate large deposits and tried to balance off that liability with mostly held to maturity treasury bonds. By January 2019, The bank held assets of $70 billion and was warned by the fed that it was not a large enough bank to hold that level of assets. By the end of 2021, the Fed warned the bank that it was not prepared to insure $114 billion of assets in deposits and investment loans. In September, the federal reserve signaled that interest rates were about to rise to slow inflation created by the pandemic spending bills and the printing of dollars. As the federal funds rate increased, SVB went on to accumulate even more assets. The SEC handed SVB 6 citations involving liquidity stress testing, contingency funding,and liquidity risk management. By the end of 2022, SVB had gone on to accumulate assets totaling $209 billion! The wild part of this is that the bank was never able to insure against rising interest rates with more resilient investments, yet continued to accumulate larger and larger deposits as the bonds lost value. They were warned several times by the regulators and other credible parties. No one beside the bank officers, the regulators, and the auditors knew of the obvious growing instability of the bank.

The Explanation Of The Accident

We were told that the brakes on the trucks had worn over time, while at the same time, the cargo had grown. The Treasury bonds had lost their value over the period of rapid inflation over the last few years. There was no explanation of why the brakes were not serviced or replaced. There was no explanation of how experienced drivers could drive with ever increasing over limit loads with wearing brakes. After the crash, every responsible party took the public criticism silently. The Federal Reserve, the bank supervisors and executives, and the SEC all took public criticism without offering any kind of defense.

Well Experienced Drivers and Crew Accelerate Through Red Light

We didn’t know that SVB went through a number of yellow and red lights without slowing down-ON PURPOSE. In January of 2019 the FDIC warned SVB that their assets of $70 billion were too high for that size bank, Then again in December of 2020, they were given a stronger warning for assets of $114 billion. In September of 2021, the Fed signaled that interest rates were soon to rise. Having the lion share of bank equity wrapped up in treasury bonds which were purchased when interest rates were zero, which depreciate as interest rates rise, would be a sufficient warning to any bank risk management officer. Those were the yellow lights.

The FDIC then, in November 2021, the FDIC issued 6 citations related to liquidity stress testing, contingency funding, liquidity risk management. Any bank the size of SVB is required to conduct quarterly liquidity tests. The brake test failed. By this time everyone knew that the bank was not supporting their assets. After all this, the bank was not fined, the officers were not penalized in any form, and they continued to turn a blind eye toward their balance sheet. Instead, they continued to accept more and more assets. They coasted through this red light as the police stood down. Around March 1st 2023, Greg Becker received a phone call from Moody’s warning him that the T bonds were approaching the level of junk bonds.

The chief risk officer, the one most responsible for the status of the brake system, Laura Izruieta, stepped down in April 2022, and then left the bank in October with $7.1 million. She was well experienced in corporate risk management, having worked at Freddie Mac as a program director for mortgage purchasing in the early 90s, working her way up to senior vice president of Capital One, leading a risk management team that built and maintained corporate risk governance structure, risk management tools and methodologies from 2006 to 2012, then executive vice president for the next 3 years, joining Silicon Valley Bank in 2016 as Chief Risk Officer. SVB had no chief risk officer until January of 2023, when they hired Kim Olson, who has 30 yrs experience in risk management, worked at Federal Reserve Bank of New York, received her bachelor’s at Santa Clara University, and her masters at Harvard. The risk committee, made up of mostly venture capital CEOs, had no one to report to in the interim. Some on the risk committee were also on the board of SVB at the same time. The committee was very heavy on the venture capital side and light on the risk side. One member was also the chairwoman of the board, while another was CEO of Benhamou Global Ventures, while another was a former president of a venture capital firm, another was co founder of a venture capital firm, yet another was a former US treasury under secretary. All 5 board members were on the ‘risk’ committee! Meanwhile, Greg Becker continued to step on the gas, increasing the bank’s assets toward $200 billion while taking loans of up to $15 billion from the Federal Home Loan Bank of San Fransisco by the end of December 2022.

The Police knew of the impending crash and not only watched, but supervised it!

The Federal Reserve and the SEC knew the bank was loading up with venture capital assets and that it was going to crash. The Federal Reserve Bank of San Fransisco sent 20 bank examiners in the second half of 2021 to SVB. Meanwhile, Greg Becker, the CEO of SVB was a director of the SF Federal Reserve! They would have nothing to say publicly until the bank announced its failure on March 10th. Back in November of 2022, there was a secret meeting of the FDIC dedicated to finding ways to hide the impending crash from the public to prevent a run on the banks in general. Moody’s even gave the CEO a phone call on March 1st to warn him that the treasury notes are approaching the level of junk bonds. They were headed for a $20 billion loss. The bank auditor, KPMG, a global woke corporation that also audited First Republic Bank and Signature Bank which were also seized by the FDIC, made no comment or report of the obvious detrimental condition of the bank when it gave SVB a clean bill of health on February 24th, and also gave Signature Bank a clean bill of health 11 days before it was seized by the Feds.

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Trucks crash, cargo salvaged, traffic passes through

On March 7th, Greg Becker, CEO of Silicon Valley Bank met with investors and wall street analysts at the Palace hotel in San Fransisco and presented a rosy, strong financial impression of the tech industry and his bank. Just one day later, the CEO of Silicon Valley Bank, Greg Becker announced that his bank has a $1.8 billion loss with a plan to raise $2.25 billion in fresh capital Upon an urging by Goldman Sachs to by shares of SVB and a warning from co founder of SVB Peter Thiel, on Thursday, March 9th, SVB depositors withdrew $42 billion in a single day. On Friday, March 10th, the California Department of Financial Protection and Innovation handed over Silicon Valley Bank to the FDIC. Like clockwork, Biden and the Federal Reserve assured the depositors on the day it was closed that their money was secure and would be available that following Monday, when the FDIC created the SVB Bridge Bank for that purpose. They then created the National Bank of Santa Clara to receive SVB’s insured assets of $30 billion. The plan all along was to transfer the uninsured assets to First Citizen’s of Raleigh, NC amounting to $60 billion with a deal for the FDIC to absorb 50% of the losses over $5 billion. In essence the crashed truck’s cargo gets placed on a federally appointed truck in order to roll it on through. The other two trucks, Signature Bank of San Fransisco, and First Republic Bank of New York, a heavy crypto lender, got the same treatment. A third truck, the UK SVB was closed on March 12th and bought whole by HSBC the next day. That bank’s financial risk manager was Jay Ersapah, well known champion of the LBGTQ+ community in Europe and the US, born and schooled in England, and who worked at Deloitte and Barclays. All other US banks were immediately allowed to go to the Federal Home Loan Bank to prop up their assets also, allowing the rest of the traffic to pass through unimpeded, for the moment. By the end of the following week the Federal Home Loan Bank absorbed $304 billion from banks across the country.

Silvergate Bank of La Jolla, California, a crypto heavy weight, also crashed in March after a $1 billion loss in the 4th quarter of 2022. Different from SVB and First Republic, Silvergate was able to return all deposits and enter into complete liquidation without an internal bail out from the FDIC. It received staunch criticism from democrat senators on the house finance and banking committee, who called for tighter regulation of the crypto market.

CEO Greg Becker, was reported to be ousted from the bank for ‘mismanagement’ and allowed to travel back to his luxurious town home in Maui with $3.6 million worth of SVB shares he cashed out just previous to the crash. He is reported to have flown first class, then driven by limo to his residence.

The Fed appointed a new CEO, Tim Mayapoulos, to their bridge bank and retained all other employees, giving them a retention perk of 45 days of time and a half pay. Tim Mayapoulos, a financial tech investor, worked at major banks previously such as Deutsche Bank and Credit Suisse First Boston and Donaldson, Bank of America, including CEO and president of Fannie Mae, 2012-2018, led Blend Labs to leading market position in mortgage and consumer banking technology

The 5 remaining board members are now charged with brainstorming what to do with the remaining $3 billion in assets.

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Planned Crisis?

The Federal Reserve knew well in advance of this impending crisis as detailed in their nonpublic November 2022 meeting of the Systemic Resolution Advisory Committee(SRAC). Well experienced bank officers allowed the bank to accumulate an outrageous amount of uninsured deposits and securities. The bank examiners went through the motions, doing obviously insufficient stress testing and ignoring the impossible liquidity tests. SVB’s balance sheet di not alert the auditor, KPMG. Nor did the First Republic Bank’s balance sheet bother that same auditor. Why would all these experienced officers and regulators risk their careers to allow all those tech startups to cruise on through? Why did so many choose to use this same bank? How on earth could all these professionals assume that the Feds fund rate would remain at or near zero? Where did all that seed money come from all of a sudden?

Some of the winners are all well known: the venture capital companies and their startups. To be able to explain this level of despotism you would have to examine what these winners are trying to start up. It can be fairly safe to say that they are starting up woke corporate cultures the likes that has not yet been seen! How many of these startups are green New Deal startups, involving the design of electric substitutes of everything gas powered? Electric Construction and landscape handhelds, electric rail, electric delivery systems, and EV charging systems are only a part of the scope of these startups. How many have ties to China? The Biden administration would not be happier if the tech startup sector became totally reliant and controlled by the feds.

Major sources of cryptocurrency went insolvent, including First Republic in New York and Silvergate Bank of La Jolla, California. At the time of this writing, the federal reserve just launched a pilot digital currency program in banks.

Who pays for the damage?

Biden and the Fed emphasized that this did not constitute a taxpayer bailout. Who will bail out the FHLB as it has amassed a total of $304 billion in new loans made in just one week in high risk securities? It was intentionally abused as it was supposed to be a safety net for low income, high risk home loans, not venture capital securities. It now has a debt load of $1.1 trillion. It is a system of 11 banks across the country designed to assist other banks and institutions to lend to individual private low income, high risk home owners. This is the bank of last resort that the other banks rely on in the worst of circumstances. The banks are now in the position of having to pay down the FDIC’s huge debt so it can insure those same banks to a higher degree. The taxpayers will most likely get stuck with the Federal Home Loan bail out so it can continue to finance low income housing that is being constructed like gangbusters across the country. This inevitable bail out will really threaten the entire economy of the US and force taxpayers to shrink their disposable income even further, while at the same time not being able to borrow. Those would be future homeowners will become renters for a much longer time in their lives. This is how the taxpayers will be forced to pay for the Green New Deal.

Confidence in the Highway System and the Police

A number of polls taken within the last week show a sharp decline in the general public’s confidence in our banking system. This directly affects the confidence in the US dollar abroad. It is not surprising to hear Macron admit publicly that he wants to oust the dollar as a valuation for Frances national currency. Others will follow unless confidence is restored within our borders.

At the time of this writing, several reliable sources have predicted quite confidently that we are headed for an imminent global recession. As our banking system becomes more and more reliant on the federal reserve to prop up their balance sheet, they will increase their fees and make it much harder to borrow, the confidence in the US dollar will erode around the world as the dollar is sold off and rejected by other countries in favor of their own currencies , threatening its reserve currency status. Once it is rejected as the worlds reserve currency, its value will plummet, causing a world wide depression the world has never experienced!

‘Global Economic Downturn’

By this writing, it has already been predicted that we are heading toward a global recession as a result of the US banking crisis. Walmart closing 2,000 stores in the US, Goldman Sachs having laid off thousands, 8% of their staff by January of this year, Meta ( Facebook’s parent company) 87,000 just last year, Amazon plans 10,000 to be laid off, Stellantis in Illinois which makes Jeep, Chrysler, and Dodge, laying off 1,350 due to “the electrification of the automobile market”, and most of the big banks cutting 1 to 5% of their staff. The most common reason the largest tech companies and others have initiated massive layoffs and have downsized their corporate staff and closed stores is what they refer to publicly as a ‘global economic downturn’. Well, everything seemed to be going reasonably well until these large banks supporting the tech industry began to be noticed to be failing. Then, in mid 2022, they started to announce layoffs planned for end of 2022 to 2023. This kind of across the board economic retreat just coincides with the growing instability of the US banking system as it pertained to unsupported venture capital investment. Any economics major could predict such a macro economic response to huge unsupported investment and almost absent risk management. This is not a spontaneous crisis. It is a well calculated redistribution of wealth scheme using the US banking system as a funnel to fund the Green New Deal. A spontaneous global depression would occur as a consequence of a depreciation of land, commodities, the dollar, natural disasters, and epidemics, etc.. Rather,as a consequence of this convenient crisis, the dollar will be depreciated significantly, even further than what has already been caused by inflation. Why, just in recent weeks have democrat governors and their supporters been announcing eliminating non-electric vehicles in the next 5-10 years? It makes no economic sense as we enter a period of economic decline, unless the real plan is to control and restrict the free market by eliminating choice for both consumers and producers. The real drivers of this change are committed to establishing a world interdependent economy that will squelch the human motivation to produce more wealth than it consumes. It is well known that the free market exists only at the mercy of government. The collapse of the US free market is welcomed collateral damage to the socialist elites so that they can justify more and more control of the means of production, even if it means the impoverishment of the United States!

The Only Solution For the United States

There Is No Political, Economic, or Social solution

As for every true crisis for the United States, the only solution to this mess are individuals who have the awareness and the courage to stand up against the true cause, the actual forces of this self imposed national cultural and spiritual deterioration. Without the awareness and resolve of our younger generations, the US will never recover from this epic defeat. The failsasfe solution will take two dedicated parents who strive to model and teach a complete awareness of both the secular and spiritual world to their children out of a profound love for them and their children. As a culture, the United States does not have the impetus to arrive at this spontaneously. Therefore, we need a few good men. Nine Eleven rallied our best young men to fight in Iraq out of their love for their country. As a result, the fact is that we grossly subdued the threat of major terrorist attacks around the world. What if they were fooled by a media that convinced them that the aggressors were not terrorists but rather unknown US citizens? This is the dilemma we now have. The results of our spiritual and secular deterioration will destroy our country and our society for everyone, even the world, as the fact is, that the rest of the world depends on a stable, vibrant US economy and strong military, two things that we’ve never been able to accomplish without God’s help. So how will we do this?

I am confident that the strongest individual men around us are about to stand up and take it to their families, to their communities, to wherever they can establish an opportunity, and speak out clearly, logically, and respectfully about the true state of our country and our society, and motivate others to make hard choices. It will involve homeschooling associations that help two working parents to have their children home schooled regardless because our public educational system has been commandeered by radical godless activists. It will involve men spiritually inculcating their family’s spiritual values and practical lifestyle. It will involve men helping men and men seeking help in order to accomplish that extremely important role. God is in control of our spiritual, economic, social, and yes, our political realities. Our children need to be aware of those aspects of reality which God has given us that man cannot change. Our children need the support to stand up and claim those realities, to wisely debate them publicly, and to defend them whenever and wherever confronted. They need to learn from the bible at home under the direction of loving fathers who are willing to answer the most difficult and important questions, be properly armed with those truths, with credible resources, and with the support of other strong men. Just as we tend to think that our 13 and 14 year olds aren’t interested in the bible, and in economics and politics, their minds are beginning to seek credible answers to all those questions. The problem with our culture is that as parents, we have lost our credibility to all sorts of third parties, including school teachers, preachers, and youth pastors, doctors, and all the high powered media getting to their minds ahead of us. Many of us have to do some serious back pedaling, and we need the mothers of the United States to learn to be absolutely become supportive of the fathers that make their whole-hearted effort. In this sense, the United States needs a spiritual re-definition of the family.

Only in the United States will this actually happen. And when it does, you will see the vengeance of the beast come after us and be totally ineffective to the absolute bewilderment of those still dependent on it. It is only in the United States that individual strong men impact its people to act. Contrary to the belief of our opposing forces, the godless elites, the United States is not a Venezuela, is not a Mexico, and is not the failed state of the European Union. The globalist elites will no longer be able to steal our children’s souls and minds and hearts en masse as they had been. They will be suffocated and be made foolish and irrelevant in a truly spiritually strengthened and civilized, revitalized and spiritually driven family culture. It is not because we have better people than the rest of the world. Countless legal immigrants have made invaluable contributions to their adopted country. It is not even because we have a constitution. It is solely because we still have individuals that understand the real purpose of our constitution, and the knowledge and truths from our founding fathers as a result of their common experience, that are imparted through it. We also have the reality of history that has proven its value to the world! Only in the United States will the balance of power always rest amongst the people governed and not the government. Only in the United States will the children be loved anew! Only in the United States!