One of our TPM readers did a good summary of the collapse of Silicon Valley Bank, whose implosion began in Silicon Valley, literally and figuratively, but probably won’t end there.
It’s a terrible stain on Silicon Valley culture and a profound rebuttal to all those libertarian trolls out there. They fought the regulation that would have subjected SVB to greater scrutiny. This was a valuable community facility that greed destroyed. This is what you get with “smart contracts”. My suspicion about Thiel is just that, no facts, but I hope some journalist can press him (and some of the other SV bros) as to whether they were short sellers on SVB shares before promoting the race. I realize this is not their natural rhythm, but frankly it has political value – why should we buy this team’s non-regular/trust us when they would turn around and destroy a community facility that had provided such a service? useful? Say what you want about JP Morgan in the early 20th century, but at least he knew it was his duty to insist on a concerted effort to stop the panic rather than profit from it.
References here are to Peter Thiel. A key accelerator of SVB’s collapse was Thiel’s guidance to all companies he invested in to withdraw their deposits as the bank’s position became more dire.
