Annotated Bibliography Of Reimbursement Of Silicon Valley Bank

Annotated Bibliography

Veron, N. (2023). Opinion: Fully reimbursing SVB depositors may prove to be a bad move. CNN News Network https://www.cnn.com/2023/03/16/opinions/silicon-valley-bank-deposit-insurance-vron/index.html In this article, Veron gives his opinion on the government's decision in trying to help solve the Silicon Valley Bank. He explains how the reimbursement the government is giving to investors who lost money to the bank will give more negative side effects in the long run compared to the present. He then explains how in the past, Theodore Roosevelet tried the same solution and caused the Great Depression.

The author, Nicholas Veron, explains the situation about the collapse of the Silicon Valley Bank. He then goes into detail

I would agree with the argument against the reimbursement of Silicon Valley Bank because it can cause a catalyst for the whole country if the amount of money being reimbursed causes the loss of value in the dollar. If I was a citizen having to endure an economic depression, I would agree with Veron because the policy changes made the economy collapse which could affect my family by complicating the acquisition of basic necessities since the dollar had lost its value. Furthermore, according to the article “Why Bailing out SVB is a Bad Idea”, by David R. Henderson, he explains that “the Great Depression lasted through the 1930s and early 1940s was that FDR kept changing the rules. With his National Industrial Recovery Act of 1933, Roosevelt forced scores of industries into government-enforced cartels. Then, after winning re-election in 1936 in a campaign in which he inveighed against “economic royalists,” FDR started major antitrust action to break up monopolies.” In the case of the Great Depression, FDR constant changes to the policies made banks increase their money reserves, so the Federal Reserve doubled the requirements which led to a recession in the US economy. This would explain why Silicon Valley Bank reimbursement is a bad idea because it can cause

In Veron’s article, he explains that the reimbursement would go against the policy set by the government, where it would benefit the wealthy and only the wealthy. However, it does not consider the positions that the wealthy hold, where the reimbursement may be necessary for the economy. Most investors in Silicon Valley Bank were company CEOS, so the reimbursement would be beneficial to them because they control companies which could be vital to the economy and the citizens of the US. According to Time.com, author Andrew Chow says, “It held the funds of hundreds of U.S. tech companies and was a crucial player in the valley’s economy.” This presents the problem with not reimbursing the investors because it can send a ripple effect through the local and national economy. These companies provide market and job opportunities for citizens, and if the CEOS don’t have the funds to maintain them, it could prove devastating. For example, John Rizzo, senior vice president, public affairs at the D.C.-based firm Clyde Group says, “We don’t know if we’re going to have to lay off or furlough employees. We don’t know if we’re ever going to get the money beyond the insured amount.” This quote shows the limits that Veron’s argument had because companies will have to fire employees in order to maintain afloat, which is just as detrimental to the US economy as not