Not one of my finest moments when I argue with my wife first thing in the morning. Similar to fighting with my kids, it does not make for a good start to the day.
What makes this “discussion” more interesting is that she asked me about the recent bank failures after watching a segment on Good Morning America. Sometimes it is really hard being married to a financial advisor and portfolio manager.
The entire US financial system can be an extremely complex ecosystem, and when mainstream media tries to explain it in a 5-minute segment, I lose my temper, to put it mildly.
It’s not Theresa’s fault; quite a few people have reached out to ask my thoughts about bank failures this week and whether I thought their money was safe or not. While bank runs are uncommon, we all have scars from the 2008 era. When depositors become anxious about the bank’s overall health, anything can happen.
The Federal Reserve and Treasury Department took the extraordinary step of designating SVB and Signature Bank as a systemic risk to the financial system, giving regulators flexibility to backstop the uninsured deposits. Regulators hoped that by protecting these deposits, they would bolster confidence in the banking system.
To help answer questions I have been fielding and explain a few of the key banking features which impact all of us, I have put together a summary that you can access here.
If you have questions about the information provided, the current baking situation, or the impacts it could have on your financial plan and portfolio, please do not hesitate to reach out to have a conversation. I am always here to help.