Blog
LatestArticlesVideos
Radio
LivePodcastSerialsStations
TV
Podcasts
The Glenn Beck ProgramThe Glenn Beck PodcastThe Beck Story
Fine Art
Real Estate
More
AboutCharityBooksSponsorsShopContact
SEARCH
Live Radio

©2024 MERCURY RADIO ARTS.
ALL RIGHTS RESERVED.

TERMS OF USE | PRIVACY POLICY

Live

Glenn's Show Prep

6 things you NEED to know about the Silicon Valley Bank collapse

March 15, 2023
NurPhoto / Contributor | Getty Images
Katarina Bradford

Silicon Valley Bank's collapse is sparking traumatic memories of the 2008 financial crash. Should we be worried SVB is signaling a similar economic catastrophe, or is everyone overreacting to the media's hype? Glenn told his listeners to be "healthily terrified." This event is sure to have ripple effects throughout the economy, but the more you are informed about it, the more you can prepare. Here are 6 things you need to know about Silicon Valley Bank's crash—explained in simple words.

1. The short answer to what happened: SVB didn't have enough money to pay its depositors.

Remember the scene from It's a Wonderful Life when all of the residents make a run on George Bailey's bank demanding their money? Fortunately for them, their money was in the altruistic hands of George Bailey, who used his honeymoon savings to give the depositors the money they demanded.

Silicon Valley Bank's depositors weren't so lucky.

In short, the depositors made a run on Silicon Valley Bank, demanding the withdrawal of their money. But SVB simply didn't have the liquid money available to give their depositors, causing regulators to shut down the bank shortly afterward.

2. It all started with COVID...

Why didn't SVB have enough money for its depositors? To explain this, we have to go back to the pandemic era.

The pandemic saw a rapid decrease in spending and a massive increase in bank deposits. Due to the uncertainty of the future and lockdowns limiting ways to spend money on recreational activities, like restaurants, bars, and other outlets, many Americans stocked up money in their accounts. In fact, SVB's deposits doubled in 2021 alone, bringing in more money than they could lend out to their clients.

To make a return on their available cash, SVB wanted to invest it, as many banks do. Since they had reached their lending limit, they decided to invest it in U.S. Treasury Securities, which are the government's means of funding itself without using taxation (in a nutshell). These are considered "ultra-safe" investments because they are backed by the "full faith and credit of the federal government."

Unlike other forms of investments, investing in Treasuries means the government will do everything within its legal power to pay back the money used to fund itself. In other words, it is typically very safe... so what happened?

3. Then came the magic cocktail—record-high inflation and rising interest rates...

Interest rates ruined the typically "ultra-safe" investment. Due to 40-year record-high inflation, the Fed lifted rates eight times by a total of 4.25 percentage points in 2022, raising interest rates from 0.25 percent to 4.375 percent. This means the value of U.S. Treasuries investments plummeted rapidly. SVB reported that it lost $1.8 billion due to the decreased value of its Treasuries investments after a year of rising interest rates.

This raises the following question: why didn't SVB just weather the storm and wait for interest rates to decrease? There are two issues with this. The first is that, with so many of their assets held up in Treasuries investments, SVB still wouldn't have enough liquid assets to give their depositors during the bank run.

The second issue is that Treasuries investments have a ten-year limit. In 2021 during the Trump administration, interest rates were at an all-time low of 0.125 percent.

The record-fast increase of interest rates in 2022 caused very little chance for rates to go back down to their historic 2021 lows within ten years for banks to make their money back on their investments.

To avoid this, SVB planned to sell their investments at a loss and re-purchase Treasuries investments at the decreased value, giving them an extra ten years to bet on decreased interest rates in the future.

But people caught on to SVB's plan and didn't want to ride with the risk.

4. Account holders withdrew their money... FAST.

As aforementioned, SVP lost $1.8 billion when it sold its depleted Treasuries investments. While they were betting on being able to re-purchase the devalued securities, hoping that they would go up in value in the future with lowered interest rates, investors were worried about the risk.

Once they made the announcement of their $1.8 billion loss, their stocks began to drop, and venture capitalists warned the companies they invest in to pull out of SVB. This had a snowball effect, leading to a "bank run" of depositors demanding to withdraw their money from their SVB accounts.

This led to the perfect storm: SVB's investment losses coupled with the influx of withdrawals were so immense that regulators had to step in and shut the bank down to protect depositors. The government currently "running" SVB, for all practical purposes, is the Federal Deposit Insurance Corporation (FDIC). The FDIC closed SVB on Friday and reopened the bank on Monday, March 13th as the Deposit Insurance Bank of Santa Clara.

5. Some people may lose their money. 

Banks insure accounts with $250,000 or less with FDIC insurance. That means, in cases of bank failure, exactly like this one, the FDIC covers all accounts less than $250,000. The FDIC said SVB customers who had less than $250,000 in their accounts will have access to all of their money when the bank reopens. Since it reopened this week, they should have access to their funds.

However, many of SVB's depositors had more than $250,000 in their accounts—it is Silicon Valley after all. Therefore, their accounts were not covered by FDIC insurance. Will they get their money back? There is a chance that they will not.

It is unclear how much SVB currently has to cover uninsured deposits. It is likely not enough. The FDIC has issued a "Receiver's Certificate" to the uninsured account holders with the amount in their account that is not covered by FDIC insurance.

The FDIC said it will pay some of the uninsured deposits by next week by liquidating any additional assets held by SVB. However, if the liquidated assets are not enough, many of SVB's uninsured account holders could lose their money for good.

6. Is this 2008 all over again?

SVB's collapse was the largest bank failure since 2008, when Washington Mutual failed with $307 billion in assets. Its failure, along with the collapse of the Lehman Brother's investment bank, triggered the worst financial crisis since the Great Depression. Are we in danger of repeating 2008?

Some argue that we are not in danger of another economic catastrophe, simply because SVB holds less than 1 percent of the nation's assets. However, as Glenn warns, there is a danger of banks repeating the same mistakes as SVP.

SVP wasn't the only bank to use its surplus deposits to invest in U.S. Treasuries, which means that other banks are wrestling with the depleted value of their securities investments due to rising interest rates.

Bank of America, for example, lost $109 billion in their securities investments due to rising interest rates, the most among its peers—and Bank of America is no small fish in the ocean of assets.

Other major banks recorded other massive losses in their securities investments due to rising interest rates. JP Morgan Chase lost $36 billion, Wells Fargo lost $41 billion, Citigroup lost $25 billion, and Goldman Sachs lost $1 billion. If the little banks collapse, will they get the same effort and attention from the federal government as the "big guys?"

The critic may argue that these are still small values given the incredibly large amount of assets held in banks nationwide. However, this is missing the point. Major banks have majorly invested in securities since the pandemic-era skyrocketing rate of deposits. Now those investments are depleted in value.

They can either sell those investments at a loss, or they can wait and hope that they will recover over time. However, if those investments are no longer liquid, what happens when their depositors come knocking? Will they have enough liquid assets to cover a massive bank run? These are the lingering questions that our banks need to address.

As Glenn says, this will impact you—it is only a matter of time. What will you do to prepare?

The Deep State's NEW plan to backstab Trump

Brandon Bell / Staff | Getty Images

We cannot make the same mistake we made in 2016 — celebrating victory while the deep state plots its next move.

In 2016, Donald Trump shocked the world by defeating Hillary Clinton. Conservatives cheered, believing we’d taken back the reins of our country. But we missed the bigger battle. We failed to recognize the extent of the damage caused by eight years of Barack Obama and decades of progressive entrenchment. The real war isn’t won at the ballot box. It’s being waged against an insidious force embedded deep within our institutions: the administrative state, or the “deep state.”

This isn’t a new problem. America’s founders foresaw it, though they didn’t have a term for “deep state” back in the 1700s. James Madison, in Federalist 48, warned us that combining legislative, executive, and judicial powers in the same hands is “the very definition of tyranny.” Yet today, that’s exactly where we stand. Unelected bureaucrats in agencies like the Environmental Protection Agency, the Department of Energy, and the Department of Justice hold more power than the officials we vote for. They control the levers of government with impunity, dictating policies and stifling change.

This is the fight for the soul of our nation. The founders’ vision of a constitutional republic is under siege.

We’ve felt the consequences of this growing tyranny firsthand. During COVID-19, so-called experts ran our lives, crushing civil liberties under the guise of public safety. Our intelligence agencies and justice system turned into weapons of political warfare, targeting a sitting president and his supporters. Meanwhile, actual criminals were given a pass, turning American cities into lawless war zones.

Thomas Jefferson wrote in 1816 that “the functionaries of every government have propensities to command at will the liberty and property of their constituents.” Today, we see Jefferson’s prophecy fulfilled. The deep state exercises unchecked power over our freedoms, and information itself is controlled by the fourth branch of government: the legacy media.

Even when we win elections, the deep state doesn’t concede defeat. It switches to survival mode. Trump’s first term proved this. Despite a historic mandate to dismantle the bureaucracy, the deep state fought back with everything it had: leaks, investigations, court rulings, and obstruction at every turn. And now, with the possibility of Trump returning to office, the deep state is preparing to do it again.

Progressives are laying out their attack plan — and they’re not even hiding it.

U.S. Rep. Wiley Nickel (D-N.C.) recently boasted about forming a “shadow cabinet” to govern alongside the deep state, regardless of who’s in the White House. Nickel called it “democracy’s insurance policy.” Let’s be clear: This isn’t insurance. It’s sabotage.

They’ll employ a “top down, bottom up, inside out” strategy to overwhelm and collapse any effort to reform the system. From the top, federal judges and shadow officials will block Trump’s every move. Governors in blue states like California and New York are gearing up to resist federal authority. During Trump’s first term, California filed over 100 lawsuits against his administration. Expect more of the same starting January 20.

From the bottom, progressive groups like the American Civil Liberties Union will flood the streets with protesters, much as they did to oppose Trump’s first-term immigration reforms. They’ve refined their tactics since 2016 and are prepared to unleash a wave of civil unrest. These aren’t spontaneous movements; they’re coordinated assaults designed to destabilize the administration.

Finally, from the inside, the deep state will continue its mission of self-preservation. Agencies will drag their feet, leak sensitive information, and undermine policies from within. Their goal is to make everything a chaotic mess, so the heart of their power — the bureaucratic core — remains untouched and grows stronger.

We cannot make the same mistake we made in 2016 — celebrating victory while the deep state plots its next move. Progressives never see themselves as losing. When they’re out of power, they simply shift tactics, pumping more blood into their bureaucratic heart. We may win elections, but the war against the deep state will only intensify. As George Washington warned in his Farewell Address, “Government is not reason, it is not eloquence — it is force; and force, like fire, is a dangerous servant and a fearful master.”

This is the fight for the soul of our nation. The founders’ vision of a constitutional republic is under siege. The deep state has shown us its plan: to govern from the shadows, circumventing the will of the people. But now that the shadows have been exposed, we have a choice. Will we accept this silent tyranny, or will we demand accountability and reclaim our nation’s heart?

The battle is just beginning. We can’t afford to lose.

Editor's Note: This article was originally published on TheBlaze.com.

Drone mystery exposes GLARING government incompetence

Gary Hershorn / Contributor | Getty Images

The drone issue is getting way out of hand.

Earlier this month, Glenn first reported on the mysterious drones stalking the night sky over New Jersey, but the situation is increasingly concerning as the sightings have escalated. Not only have drones been seen across the Northeast Coast, including over New York City, Maryland, and Pennsylvania, but recently, they have been spotted over the night skies of San Diego and other parts of Southern California.

It doesn't take an expert to identify the potential dangers and risks that dozens of undetectable, unidentified six-foot or larger drones pose to national security. Yet, our government's response has been one of unimaginable incompetence, leaving us to speculate on the origin and intention of these drones and wonder in astonishment at the government's ineptitude. Here are three examples of the government's lackluster response to the mystery drones:

Iranian Mothership and Missing Nuclear Warheads

- / Stringer | Getty Images

After several weeks of hubbub, New Jersey Representative, Jeff Van Drew gave an interview on Fox News where he claimed that the drones originated from an Iranian "mothership" off the East Coast of the United States. This theory has since been disproven by satellite images, which show that all Iranian drone carriers are far from U.S. shores. Another theory suggests that drones may be equipped with sensors capable of detecting nuclear material and that they are looking for a nuclear warhead that recently went missing! With these apocalyptic theories gaining traction in the absence of any real answer from our government, one can't help but question the motive behind the silence.

Pentagon's Limp Wristed Response

Alex Wong / Staff | Getty Images

In a recent press conference, national security spokesman John Kirby responded to reporters demanding answers about the government's lack of transparency, which has caused increasing public anxiety. He insisted that the drones did not pose a threat and were not assets of a foreign power, such as from Iran or China--even though he is still uncertain about their identity and origin. He also claimed that many of the sightings were simply misidentifications of normal aircraft.

This lackluster answer has only further inflamed national anxieties and raised even more questions. If the government is unsure of the identity of the drones, how do they know if they are a threat or if they aren't foreign assets? If they aren't foreign, does that mean they are U.S. assets? If so, why not just say so?

The Pentagon has also stated that they are leaving it up to local law enforcement to spearhead the investigation after concluding that these drones pose no threat to any military installation. This has left many feeling like the federal government has turned a blind eye to a serious issue that many Americans are very concerned about.

Where's Pete Buttigieg?

Chip Somodevilla / Staff | Getty Images

We are in the closing weeks of the Biden administration, and with the finish line in sight, Secretary of Transportation Pete Buttigieg probably figured nothing else could go wrong on his watch—but boy was he wrong. As Secretary of Transportation, Buttigieg is in charge of the FAA, the agency responsible for managing all air traffic across the nation. One would think that mysterious, 6-foot-long, seemingly intractable drones are invisible on radar and flying above major cities would pose a serious threat to the myriad of legal aircraft that traverse our skies. Yet, Buttigieg has been silent on the issue, adding another failure to his resume which includes: malfunctioning airplanes, the train derailment in Ohio, and the Baltimore Key Bridge collapse, just to name a few.

Glenn: How Alvin Bragg turned hero Daniel Penny into a villain

Michael M. Santiago / Staff | Getty Images

We cannot allow corrupt institutions to punish those who act to protect life and liberty.

America no longer has a single, shared understanding of justice. Two Americas now exist, each applying justice differently depending on who you are and where you live. One America, ruled by common sense and individual courage, praises heroes who stand up to protect others. The other, driven by political agendas and corrupted institutions, punishes those same heroes for daring to act.

This stark division couldn’t be clearer than in the case of Daniel Penny, the Marine whose trial in New York City this week drew strong reactions from both sides across the divided line of justice.

If we let this slide, we accept a world in which heroes are treated as criminals and the law is a weapon for ideological warfare.

Penny was on a subway train last year when Jordan Neely — a man suffering from severe mental illness and reportedly high on drugs — began threatening passengers, saying, “I’m going to kill you all.” The fear on that subway car was palpable, but nobody moved. Nobody, that is, until Penny did what needed to be done. He took action to protect innocent lives.

In the America many of us used to believe in, Penny’s response would be heralded as heroic. His actions mirrored the courage of Todd Beamer on Flight 93, who, on September 11, 2001, rallied others with the words, “Let’s roll,” to prevent further tragedy. But in New York, courage doesn’t seem to count anymore. There, the system turns heroes into villains.

Penny subdued Neely using a chokehold, intending only to restrain him, not kill him. Tragically, Neely died. Penny, filled with remorse, told the police he never meant to hurt anyone. Yet, instead of being recognized for protecting others from a clear and present threat, Penny stood trial for criminally negligent homicide.

In Alvin Bragg’s New York, justice bends to ideology. The Manhattan district attorney has made a career of weaponizing the law, selectively prosecuting those who don’t fit his narrative. He’s the same prosecutor who twisted legal precedent to go after Donald Trump on business charges no one had ever faced before. Then, he turned his sights on Daniel Penny.

A jury may have acquitted Penny, but what happened in New York City this week isn’t justice. When the rule of law changes depending on the defendant’s identity or the prosecutor's political motives, we’re no longer living in a free country. We’re living in a state where justice is a game, and ordinary Americans are the pawns.

The system failed Jordan Neely

It’s worth asking: Where were activists like Alvin Bragg when Neely was suffering on the streets? Jordan Neely was a tragic figure — a man with a long history of mental illness and over 40 arrests, including violent assaults. The system failed him long before he stepped onto that subway train. Yet rather than confront that uncomfortable truth, Bragg’s office decided to target the man who stepped in to prevent a tragedy.

This isn’t about justice. It’s about power. It’s about advancing a narrative where race and identity matter more than truth and common sense.

It’s time to demand change

The Daniel Penny case — and others like it — is a wake-up call. We cannot allow corrupt institutions to punish those who act to protect life and liberty. Americans must demand an end to politically driven prosecutions, hold DAs like Alvin Bragg accountable, and stand up for the principle that true justice is blind, consistent, and fair.

If we let this slide, we accept a world in which heroes are treated as criminals and the law is a weapon for ideological warfare. It’s time to choose which America we want to live in.

Editor's Note: This article was originally published on TheBlaze.com.

CEO Brian Thompson's killer reveals COWARDICE of the far-left death cult

Jeff Swensen / Stringer | Getty Images

Early on the chilly morning of Wednesday, December 4th, Brian Thompson, CEO of health insurance giant, UnitedHealthcare, was walking through Midtown Manhattan on his way to a company conference. Suddenly, a masked and hooded figure silently allegedly stepped onto the sidewalk behind Thompson, drew a 3-D printed, silenced pistol, and without warning fired multiple shots into Thompson's back before fleeing the scene on an electric bicycle. After a multiple-day manhunt, a 26-year-old lead suspect was arrested at a McDonald's in Altoona, Pennsylvania after being recognized by an employee.

This was not "vigilante justice." This was cold-blooded murder.

As horrific as the murder of a husband and father in broad daylight in the center of New York City is, the story only gets worse. Even before the murder suspect was arrested, left-wing extremists were already taking to X to call him a "hero" and a "vigilante" who "took matters into his own hands." Even the mainstream media joined in on the glorification, as Glenn pointed out on air recently, going out of the way to show how physically attractive the murder suspect was. This wave of revolting and nihilistic fanfare came in response to the findings of online investigators who surmised the murder suspect's motives to retaliate against healthcare companies for corruption and denied coverage. The murder suspect supposedly underwent a major back surgery that left him with back pain, and some of his internet fans apparently viewed his murder of Thompson as retribution for the mistreatment that he and many other Americans have suffered from healthcare companies.

The murder suspect and his lackeys don't seem to understand that, other than depriving two children of their father right before Christmas, he accomplished nothing.

The murder suspect failed to achieve his goal because he was too cowardly to try.

If the murder suspect's goals were truly to "right the wrongs" of the U.S. healthcare system, he had every tool available to him to do so in a constructive and meaningful manner. He came from a wealthy and prominent family in the Baltimore area, became the valedictorian at a prestigious all-boys prep school, and graduated from the University of Pennsylvania with a master's in engineering. Clearly, the murder suspect was intelligent and capable, and if he had put his talent into creating solutions for the healthcare industry, who knows what he could have accomplished?

This is the kind of behavior the far-left idolizes, like communists on college campuses who wear shirts that celebrate the brutal Cuban warlord, Che Guevara. Merchandise celebrating the UnitedHealthcare CEO murder suspect is already available, including shirts, hoodies, mugs, and even Christmas ornaments. Will they be sporting his face on their T-shirts too?

This macabre behavior does not breed creation, achievement, success, or life. It only brings death and risks more Americans falling into this dangerous paradigm. But we still have a chance to choose life. We just have to wake up and take it.