Stuart Varney: The US is in a banking crisis...and we don't know where it's going
If a full-scale bailout happens, taxpayers will pay the price for Wall Street's mistakes, Varney warns
'Varney & Co.' host Stuart Varney argues that the Biden administration's spending and 'massive' Fed money printing pushed the U.S. into a 'banking crisis.'
During his "My Take," Monday "Varney & Co." host Stuart Varney analyzed the Silicon Valley Bank collapse, arguing the Biden administration's massive spending, the Federal Reserve's inflationary monetary policy, and bad bank management all contributed to the U.S.' "banking crisis."
STUART VARNEY: We are in a banking crisis and don't know where it's going. It's a fast-moving situation.
Moments ago, the president addressed the crisis and said, "Our banking system is safe. Managers of the banks will be fired if they are taken over by the FDIC." He said he will do "whatever it takes."
Backtrack a moment. Who is to blame for this? In my opinion, it is massive spending by the Biden team, and massive printing of money by the Federal Reserve, which created inflation, which pushed the Fed to the most rapid rise in interest rates in decades.
FOX Business' Stuart Varney argues Biden's spending and 'massive' Fed money printing pushed the U.S. into a 'banking crisis.' (Fox News)
I would add that bad management by the banks didn't help. In some cases, their "woke" agenda may have been a distraction.
Where are we going? Honestly, it's hard to say, the crisis is unfolding as we speak. However, it looks like some changes may be coming.
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The Federal Reserve may be reluctant to keep raising interest rates aggressively. That's not something central banks do when there is a crisis of confidence in the banks.
Regulators may also raise insurance coverage on deposits, plus raise the amounts of ready cash that banks have to have in reserve.
A customer stands outside of a shuttered Silicon Valley Bank (SVB) headquarters on March 10, 2023 in Santa Clara, California. (Justin Sullivan/Getty Images / Getty Images)
This is an intensely political situation. The authorities are back-stopping supposedly a lot of small start-up technology companies, many of whom are working on climate change solutions.
With the Signature Bank failure in New York, the authorities are back-stopping a bank that went heavily into the crypto market.
If a full-scale bailout happens, the taxpayer would then be on the hook for the mistakes of the financial markets. The left will not like that; they have no time for Wall Street!