Best looking weekly chart, page-1286

The Australian Reserve Bank should be cautious, when raising interest rates, into a fragile market!

SiliconValley Bank (like the other bank that failed) had a differentcustomer base than a typical bank - startups (crypto firms). Becauseof a boom in startup activities, Silicon Valley Bank had moredeposits come in in 2021 and early 2022 than they could loan out. Sothey bought long term treasuries and mortgage backedsecurities with the deposits they couldn't loan out. They didn'thedge those bonds for rising interest rates, just planning to hold tomaturity. Then startups stopped getting money and depositing it dueto a change in economic conditions. But they continued withdrawingmoney to meet their expenses. So Silicon Valley Bank ended up needingto sell some of their bonds. Since interest rates had risenthroughout 2022 they sold them at a loss. Venture capitalists tooknote of the bank selling $22 billion in bonds for a loss and advisedtheir clients to withdraw funds. So SVB had a bank run.

And now as each snow flake topples, the avalanches begin!