Why did America’s Silicon Valley Bank go bankrupt?

Silicon Valley Bank was in financial trouble due to their investment in bonds that had lower returns than inflation, even after the Federal Reserve raised interest rates. This meant that they weren’t making enough money to meet their customers’ needs, which made things worse when they tried to fix the problem.

Investors and analysts took the rise in inflation as a sign of danger, leading to panic and venture capitalists warning people to take money out of the bank. The Federal Deposit Insurance Company stepped in, sending managers home but allowing cashiers to keep working.

Silicon Valley Bank was not the kind of bank most people keep their money in, but its major customers were Silicon Valley tech startups, which kept their deposits in the bank due to its large deposits. It differed from traditional banks in that it had few customers but large deposits, which were used by tech startups to pay their creditors and employees. At the time of its closure, it had $209 billion in assets.

The closure of Silicon Valley Bank was a warning to the technology economy, as it helped tech startups from Mumbai to Beijing open US bank accounts and get in the eyes of investors. In the US, money held by the federal government in insured bank accounts cannot disappear just because a bank goes bankrupt, but the sum insured limit is two and a half lakh dollars. On Friday afternoon, none of those investors had any idea how they were going to get their deposits back.

Foreign tech startups are facing a problem due to the lack of a US bank to transfer their money to. Companies like XieLab and View Technologies have put money into Silicon Valley Bank, but according to Startup Y Combinator, 10,000 Indian startups and thousands of Indians who have accounts there may not be able to get paid.

The US government announced on Sunday evening that anyone with money in Silicon Valley Bank would have access to their full amount on Monday. This was due to the US government’s ability to bail out banks and guarantee funds, as well as the global reserve currency, the dollar, and the concentration of technology companies in the US. People and institutions around the world breathed a sigh of relief.

Few governments are able to offer the level of protection where they have the resources to step in and save a failing bank. Along with talent, technology and innovation need more and more money to ensure thatces to step in and save a failing bank. Along with talent, technology and innovation need more and more money to ensure that. China and India must also develop this capability within themselves if they want to become technological superpowers.

Silicon Valley Bank is still insolvent, and even though the US government can save the banks, it cannot escape the political fallout from helping the world’s wealthiest tech investors with tax dollars.

Interesting enough, Silicon Valley Bank could have received a very early warning thanks to the oversight and scrutiny system the Obama administration put in place after the 2008 financial crisis. Sadly, the Trump administration has dismantled those oversight and regulatory procedures. All of this will lead to mudslinging at each other in the coming months as Democrats and Republicans argue over whose fault it all was.

Japanese Companies exit China :Is the era of Made in China?

Japanese Companies , the United States, and other countries are escalating their efforts to shift production out of China in order to reduce the risk of supply chain disruption caused by rapid changes in Chinese government policy and the turmoil caused by the spread of COVID-19.

Teikoku Databank, Ltd. reports that as of June of last year, there were 12,706 Japanese-affiliated businesses operating in China, a decline of 940 over the previous two years and almost 1,700 from the high year of 2012.

In 2019 and 2020, the South Korean company Samsung Electronics Co. relocated its PC and smartphone manufacturing to Vietnam.

According to The Singapore Post, which cited the Japanese media outlet Asahi Shimbun, 135 companies involved in the production of semiconductors, apparel, household appliances, cosmetics, and motor vehicles have started shutting down their operations in China.

Some Japanese businesses are returning home because they believe the weakened yen is hurting their earnings, while others are moving their production bases to Vietnam and other South Asian nations.

Is it too late for the US to contain China?

Veteran Singaporean diplomat Kishore Mahbubani claims that the US is wasting its time by continuing to try and “kneecap” China. Is it pointless to oppose China’s status as a superpower?

Is it finally time for the US to accept it? Depending on the response, either more stability or chaos could be on the horizon for the world. For more than 30 years,

Kishore Mahbubani represented Singapore as a diplomat and presided over the UN Security Council. He advises the host Steve Clemons that the US should get used to living in a multipolar world that it cannot control. According to Mahbubani, the “Asian century” has already started, and Washington shouldn’t let problems like Taiwan sour their relations.”