of silicon valley bank, that was not the fed fault, not regulatory issue, it was plain straight idiot management underneath incompetent board. i hate to put it that way, those are the facts. you can t protect yourself against idiot management, there is always a black swan and you found it in silicon valley bank. this morning with the new policy, i don t care what bank we re talking about anymore, you as a depositor have no risk whatsoever. so what stops the idiot bank manager going forward from doing anything they want within the regulatory environment taking as much risk as possible to get the stock price of that bank up, that is how they are compensated, this will create perverse acts by bank managers and crazy behaviors. in the end, it is not a
authorities we need to establish or people we need to hold accountable we will do that. bret: yeah. i want to play this soundbite and we will move on. this is kevin o leary earlier today. that was not the fed s fault. that was not regulatory issues. it was plain, straight, idiot management underneath an incompetent board. i think the unintended consequences of creating a nationalized no risk banking system is starting to sink n the last 24 hours. and this bank is going to range and undoubtedly become a political issue. bret: only one board member apparently of that sill cob valley bank board had experience at banking. now we are hearing there are investigations by the doj, by the fed and others. last word here. where do you think this goes, senator cardin? well, i think, first, we are going to certainly not be protecting the investors and the banks. that s their risk and quite frankly i think we need to look forward as to what type of changes we need to make to make sure that t
on the way. i don t consider that. if credit swisse is going to fail, let it fail. my point is we should have let silicon valley bank fail. that s not the end of our system. they represent a tiny fraction of the economy. the whole issue is around confidence in banking. i think, you know, cooler heads would have prevailed realizing that 95% of the assets are recoverable in silicon valley bank. you talked about selling this bank. the franchise value of the world silicon valley bank has been trashed. it s no better than radioactive waste. it s the poster boy for idiot management. nobody wants it. i m confident they won t get bought. when you guarantee a bailout for every depositor, what about the people that were outside painting the steps or the person that runs the kitchen and all of the creditors?
it s no longer a risk, it s no longer private in any sense. it is now backstopped by the government, ultimately, the taxpayer. so it doesn t matter how bad you are, as a bank manager. a good example is what happened to the silicon valley bank. that was the 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. that s what should have happened. we knew before the weekend started, with every account, with $250,000 or less was insured, and anything beyond it was not, but that s all changed. now you have no risk in any bank, any time, and you as the taxpayer bear that going forward. when we spoke on friday, you said, how big a deal is this, kevin? you said, next week the real trouble starts when they can t make payroll. now it looks like they will be making payroll, i would imagine. what do you think?