From Bloomberg News and iHeartRadio. It's the big take. I'm west COASOVA today. Is the money in your bank account still safe? Once again? The US government is rushing to contain the damage after a bank failed from poor management and loosened laws, and that fallout from the collapse of Silicon Valley Bank will continue for weeks and probably months. The Biden administration is assuring tech startups and other companies that the billions they had in the bank will be paid out and they won't lose their money. But who's going to foot the bill? And how will all of this financial turmoil potentially affect your savings and money you may have invested. Colleagues Ben Bane, who leads Bloomberg's coverage of how Washington regulates Wall Street, and personal finance reporters Suzanne Woolley are here with answers. Susanne, there's a lot of coverage over the Silicon Valley Bank now and how it's going to affect business in the economy. But I think a lot of people, and I am one of them, are thinking a little closer to home. So let me ask you, just off the top, how concerned should people be about the money we have in the bank. The reassuring answer is that most people really don't have that much to be concerned about, for the simple fact that most of us don't have over two hundred and fifty thousand dollars with a single bank. So any deposits we have are covered by the Federal Deposit Insurance Corporation the FDIC, and each account is covered up to two hundred and fifty thousand, and actually you can be covered for more at the same bank because that two hundred and fifty thousand applies to different cagories of ownership. So say you know, I have an account savings account that's two hundred fifty k that's covered. My husband has one that's covered up to two hundred fifty k. If we have a joint account, each of us counts for that two hundred and fifty thousand dollars, so that's another five hundred thousand dollars in coverage. So that gets you to a million in coverage pretty easily. And there are actually some other types of accounts that you can open, like trusts, that will sort of stretch that FDIC insurance even further. So as long as you don't have more than two hundred and fifty thousand dollars in an individual account or five hundred thousand in a joint account, which, as you say, most people don't, then you're pretty much covered in case something bad happens to the bank. So the really extraordinary thing we saw happen just two days after Silicon Valley Bank failed was that the federal government stepped in and said, not only are those insured deposits that we're talking about covered, but these uninsured deposits are also going to be covered. People are going to be made whole. So it's all of those businesses that have money beyond that two hundred and fifty thousand dollars sitting in that bank that they can also get out there. And it's a big deal because this is really what everyone was kind of wondering. This bank and some of these other smaller banks that are out there. Businesses, industries around the country really depend on them. And what the government did is they stepped in here and said, it's not just that two hundred and fifty thousand dollars or less, but it's the bigger deposits too. So let me ask you about that. Because Treasury Secretary Janet Yellen came forth to say this, the government is going to protect all of these account holders, even if they're above the two hundred and fifty. How does that work? Where does that money come from? So that's a little bit of we're going to wait and see. At the moment, we're still kind of getting all the details as this schools out. We know that they've said Silicon Valley Bank depositors, you can start taking out your money on Monday, which is just really the first business day after the bank failed on Friday. It's just pretty incredible because you know, the fd i C doing this is obvious, such a huge step, and it's such a such a big move to reassure depositors and savers because as we know, a lot of like bank run situations, it's just psychology, it's contagion, and so communicating that we're going to be there as this sort of backstop and even a bigger way than before, you know, it shows how concerned they are about it. But it also should give some reassurance. Yeah, and it also raises the question, so where does this stop? Right we had you had the failure of this bank, and then at the same time that the government announced these extraordinary measures. They also announced that they were taking over another bank, Signature Bank, a bank in New York, and they were going to cover those deposits as well. So we have these two banks that have failed in the span of a couple of days, literally and the government's going to step in and make everyone whole. But you know what happens now that we're worried about perhaps this spreading to other banks, you know, where does it kind of end? I mean, that's true. Although people will talk about how like Silicon Valley Bank was a bit of an outlier, and how they manage their assets and liabilities and in there who their clientele was of startups and vcs, vcs meaning venture capitalists, And I think if you're looking at like a city at JP Morgan A Wells Fargo, your concerns are not going to be as great as with a smaller regional bank that you've never heard of. Let me ask you about that, Suzanne, because these smaller regional banks, two of them have already fallen, are now under a lot of scrutiny, and there's some questions about whether there are other banks that had similar business practices that make them vulnerable. So if you have just your deposits in one of these regional banks a lot of people do. Now, is there a reason to be concerned that those banks are going to be a little bit shakier? I think everybody should maybe want to do a little more research into the bank where their money is in. Right now, it's hard to say. With regional banks, we don't know what's going to sort of come out of the closet here, and it's hard for an individual investor to go on to their regional bank site and figure out, like, what does my bank's balance sheet look like? But it is a good time to sort of understand how the FDSC rules work, to do up some reading on your bank. If it's a bank that maybe you went into because it had the highest interest rate and you don't know that much about it, it could very well be fine, but just take a look. I mean the point that a lot of people are saying to me, and this is very obvious, but it's just to not panic. You know. Any panicking rarely leads to anything good. So I think people should be smart and investigate and sort of take some prudent actions, but not freak out about this. And another thing to underscores that if we're talking about people, the vast majority of people that we're talking about that don't have two hundred and fifty thousand dollars in a bank account or above that, that was never really in play here, right, I mean, that was always covered throughout this whole process. So what we were really trying to see how much the government was going to step in here was about those larger commercial accounts and in the effect in the real economy then is those banks, these regional banks, play a bigger and bigger will have come to play a huge role trillions of dollars in assets at this point industries from wineries in California to tech startups to you name it across the United States. These are the banks that make it work. And what we were all kind of waiting to see was what's the government going to come out swinging, so to speak and do something for all those businesses. And they did. Now the question is was it enough to convince everyone that all the other banks, you know, don't need to panic, and people and businesses don't need to panic, and everyone should just kind of take a chill, so to speak, and take a beat. Ben President Biden came out on Monday with a really forceful speech in which he said, US taxpayers are not going to be on the hook for any losses. And this is an important point. No losses will be born by the taxpayers. I mean to repeat that no losses will be born by the taxpayers. But how can that be if the bank has collapsed, its assets are now in doubt. Who is going to pick up the bill? So there's this big deposit insurance fund. And what the government did when they came out on Sunday and said that they were announcing these extraordinary measures. In addition to saying the taxpayers weren't going to be on the hook, they said that the support for uninsured depositors is effectively going to be recovered from a special assessment is what they're calling it, on banks. So essentially banks are going to have to kick in more money, not just the banks that failed, but other banks as well. What we don't know is the details of that how that's going to work. But essentially there's going to be this special assessment which is going to mean that the other banks have to pay more money back into this fund and the taxpayers, so to speak, you or me or anyone else. President Biden and also the regulators are saying are not in the hook directly. It's going to come from the industry itself. And does the president have the power just to tell banks you have to pay a whole bunch of money to shore up a bank they failed. As the statute is written, My understanding is that when the fund is drawn down, it has to be replenished by the industry. So so there's not anything extraordinary happening here. It's it's basically how it's supposed to work. They are using their special powers, so to speak, or their powers to use it at this time and go about, you know, making sure these uninsured depositors are whole. But they're not coming up with a whole new system by which the other banks are going to have to kick in money. That that's pretty much established in the law. And I always wonder, like, how will that trickle down to the average investor? You know, might whatever the banks sort of have a higher cost. I cynically feel like that's going to trickle through to us and higher fees or less lending or something like that. Well, Susan, it's an interesting point because one of the things that the government really went out of the way to do in its statement when it was announcing all this was they basically said, look, investors, your take in your risks. Right, we're not bailing out shareholders so to speak. Here we're bailing out or they're not using the word bailing out, but they're protecting and making hold depositors. But they really went out of their way to say, look, if you bet on a bank or you bet on a company as an investor, this isn't making you hold. So if you want stock in the bank and the stock went down, they're not going to recoup your losses. Do your research, is what they're basically saying. And they're also saying, you know, the executives that were sitting at these banks which the government came in and took over after they were closed by state regulators, they're all gone too, right. I mean, they essentially said that they're not bailing out executives either. Our conversation continues after the break ben. Another thing that President Biden said in his speech on Monday Day was that he was going to strengthen bank regulations. I think a lot of us remember after the financial collapse in two thousand and eight, two thousand and nine, the Obama administration pushed through some pretty tough bank regulations to keep them from failing. That was over Republican objections, and then some of them were watered down a bit under Trump. What happened then and how did that play into what we're experiencing right now. Yeah, so it took all of I think three days for this to become the latest Washington partisan tug of war. Back in twenty eighteen, there was actually a bipartisan law that was passed by Congress that gave some of these smaller banks and smaller I mean including Silicon Valley Bank and the like. And Silicon Valley was the sixteenth biggest bank in the United States before its failure, so it's not small, but it gave these kinds of banks that aren't the big Wall Street banks you think of, effectively a way out of some of the really really really tough, onerous types of regulations like years least stress testing and some of the stuff that these big banks have to do every year. They're just like thousands of hours of work where the government comes in and really tests if you were in financial distress, would your bank fail. This idea that banks can't be too big to fail again. So they look at how much money do they have in deposits? What would they do if there was a sudden dip in the stock market. That's that's exactly right. And literally, almost since the big post financial Crisis law was passed in twenty ten, everyone calls Dodd Frank really almost immediately, these midsize banks were lobbying, and they're basically saying, we shouldn't be considered the same as Goldman Sacks or JP Morgan because we're not the same. We're basically just your you know, your your friendly neighborhood bank. We take deposits and you know, and we we help businesses, and we're not doing all these things that all these big Wall Street giants are doing. They lobbied, and they and they, and they kept pushing on it and pushing on and pushing on it, and finally, in twenty eighteen, bipartisan group of lawmakers passes a new measure which basically rolls back some of the restrictions they have. Trump signs it in the White House, has a big ceremony, calls it crippling regulations that are basically being stripped away. He says that these types of rules were going to make these banks go away one by one, and everyone seems to be kind of on the same page, except for some of the progressives who said this was really a bad idea, that this was a good thing to do. Fast forward five years later, and almost immediately from the moment Silicon Valley Bank failed, people are pointing to this roll back and saying, if this hadn't happened, we probably would have known a little bit more about what Silicon Valley Bank situation really was. Federal regulators may have been a little more prepared to know under the hood what was going on, and the bank itself would have had to have taken more care and not made certain kinds of bets that effectively, when interest rates shot up, really shot the bank in the foot. And by the way, some of the bank executives that were pushing hard included Silicon Valley Banks CEO Greg Becker, people like Elizabeth Warren are already jumping on that just a day later and saying, you know, look, all these all these bank executives were arguing for this rollback, and here we are, and you know, we already have two banks that have failed. Hey Ben that's funny. I was going to ask you about like what Elizabeth Warren is saying right now, But I also wondered how strong is the banking lobby in Washington. Banks, like a lot of industries in Washington, have a lot of firepower. They have a lot of lobbyists, and you know, they're they're quite good at getting access and oftentimes getting what they want. Suzanne, back to this question of what Biden can do to strengthen bank regulations. We saw them rolled back as Ben was talking about what can they do to prevent this sort of thing from happening? Again? What are regulations in that toolkit? There's a number of things that regulators could do. They could require banks to hold more capital on their balance sheet. You know, when you look at Silicon Valley Bank, they had a very extreme position in their assets and liabilities. Things like that could be more of these sort of stress test related type changes that could be done. But Ben, what do you what do you here? I mean, it's it's it's pretty interesting because the rollback was a bipartisan measure in Congress. So now to really really turn the screws, like perhaps Elizabeth Warren would like or her colleagues would like, Congress almost needs to do something again, and it's already looking like that's going to be hard. You have big kind of divisions already in terms of what Republicans are saying and what Democrats are saying. Unsurprisingly, but this moment, in this like hyperpartisan moment, this it's hard to see kind of a kumbayah where everyone agrees to tighten the screws on on banks right now, so that kicks it to the regulators. And the regulators can do some things, uh certainly, you know, the Federal Reserve, the FDIC, they all have powers and they can do more, but it can only go as far as the law will let them. And then there's a question of what could President Biden do on his own? Is there something he could do through executive action? Those are all the kinds of things I think are gonna have to be ironed out, you know, in the days ahead. He just basically said I want action, but didn't really say how that's going to happen. We'll be right back, Susanne. We started this conversation talking about how it affects individuals and how we can protect ourselves. One way, of course, as you describe as just having kind of good bank account hygiene, making sure that you don't have more money in the bank if you're so lucky than the limit allows. What else can people do just to stay safe in a time of volatility, right, I think we're in such a an out of control seeming environment that just, you know, taking controlling what you can control is really important. And when I was speaking with a financial planner earlier, he said that one of the biggest you know, quote air quotes some mistakes that he sees that people stop investing when they're feeling nervous. So, you know, when you're you know, you're putting away however much you can and four one K and you're like, oh, things are kind of crazy. I think I'll step back and maybe lower my you know, the percentage of my salary that I have going into my four one k. You know, that is really not the greatest thing to do, because a lot of times when people dial back their savings, they sort of forget to go back in and dial it up. So just sort of resisting the urge to stop a really good savings habit, if you have one, is something to keep in mind in the midst of all this turmoil, Suzanne, what about just other kinds of investments stock marketed bonds. Are there things that people should be doing now in the wake of this to kind of give themselves an extra layer of protection or comfort. I think people should take a look at their portfolio and make sure that they're still comfortable with the level of risk that's in their portfolio. You know, if they have a portfolio that's seventy percent in stocks thirty percent in bunds, they should take a look and make sure they're still comfortable with that split. But I think anybody who has a good long term plan or maybe as in say a target date fund, which is a kind of fund in the many four one ks have that is sort of geared toward a long term time horizon, and you don't want to make any rash moves to upset long term plans, because what we've seen in so many market crashes and panics over the decades is that it's the people who panic who sometimes just get hurt the most. And Susanne, that's that's exactly what the US government is trying to impart on everyone by what they've what they've done so far, everyone's trying to say, don't panic, just kind of hanging there, and the fact that the US governments stepping in with extraordinary measures. They really want people to feel assured that their money is going to be okay, They're going to be able to make payroll if they're running a business. And the question is is are all these other banks who may have been similarly positioned in terms of what they were holding on their balance sheet as the ones that have gone down, are they going to be okay? Are they going to be able to weather this? And that's the big question. Ben. You're covering all the ups and downs of this story as the fallout continues. I think we're probably gonna be talking about this for weeks to come or longer. What are you watching for? What are the things that you're especially looking for as the story keeps going. So far, we've had two banks fail in the span of less than a week and one bank voluntarily liquidate. The bank that failed, Silicon Valley Bank, was the biggest bank failure since two thousand and eight. What that means is everyone is un high alert. Everyone is trying to figure out our other lenders potentially at risk. If you look at the market moves If you look at regional lenders stocks, there's a lot of jitters out there. A bunch of firms are seeing massive declines in their share price. The question is has the government done enough to convince people that they've dealt with the problem. This was an isolated situation to a few institutions and everyone's going to be fine and we can move on. Or is this going to continue to kind of cascade? Is this going to be more of a domino situation. That's what I think everyone's watching right now. Ben Bam, Suzanne Willie, thanks for coming on the show. Thank you, Thanks guys, thanks for listening to us here at The Big Take. It's a daily podcast from Bloomberg and iHeartRadio. For more shows from my Heart Radio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen, and we'd love to hear from you. Email us questions or comments to Take at Bloomberg dot net. The supervising producer of The Big Take is Vicky Virgolina. Our senior producer is Catherine Fink. Michael Fallero is our producer. Our original music was composed by Leo Sidrin. I'm west Kasova. We'll be back tomorrow with another big take

From Bloomberg News and iHeartRadio. It's the big take. I'm west COASOVA today. Is the money in your bank account still safe? Once again? The US government is rushing to contain the damage after a bank failed from poor management and loosened laws, and that fallout from the collapse of Silicon Valley Bank will continue for weeks and probably months. The Biden administration is assuring tech startups and other companies that the billions they had in the bank will be paid out and they won't lose their money. But who's going to foot the bill? And how will all of this financial turmoil potentially affect your savings and money you may have invested. Colleagues Ben Bane, who leads Bloomberg's coverage of how Washington regulates Wall Street, and personal finance reporters Suzanne Woolley are here with answers. Susanne, there's a lot of coverage over the Silicon Valley Bank now and how it's going to affect business in the economy. But I think a lot of people, and I am one of them, are thinking a little closer to home. So let me ask you, just off the top, how concerned should people be about the money we have in the bank. The reassuring answer is that most people really don't have that much to be concerned about, for the simple fact that most of us don't have over two hundred and fifty thousand dollars with a single bank. So any deposits we have are covered by the Federal Deposit Insurance Corporation the FDIC, and each account is covered up to two hundred and fifty thousand, and actually you can be covered for more at the same bank because that two hundred and fifty thousand applies to different cagories of ownership. So say you know, I have an account savings account that's two hundred fifty k that's covered. My husband has one that's covered up to two hundred fifty k. If we have a joint account, each of us counts for that two hundred and fifty thousand dollars, so that's another five hundred thousand dollars in coverage. So that gets you to a million in coverage pretty easily. And there are actually some other types of accounts that you can open, like trusts, that will sort of stretch that FDIC insurance even further. So as long as you don't have more than two hundred and fifty thousand dollars in an individual account or five hundred thousand in a joint account, which, as you say, most people don't, then you're pretty much covered in case something bad happens to the bank. So the really extraordinary thing we saw happen just two days after Silicon Valley Bank failed was that the federal government stepped in and said, not only are those insured deposits that we're talking about covered, but these uninsured deposits are also going to be covered. People are going to be made whole. So it's all of those businesses that have money beyond that two hundred and fifty thousand dollars sitting in that bank that they can also get out there. And it's a big deal because this is really what everyone was kind of wondering. This bank and some of these other smaller banks that are out there. Businesses, industries around the country really depend on them. And what the government did is they stepped in here and said, it's not just that two hundred and fifty thousand dollars or less, but it's the bigger deposits too. So let me ask you about that. Because Treasury Secretary Janet Yellen came forth to say this, the government is going to protect all of these account holders, even if they're above the two hundred and fifty. How does that work? Where does that money come from? So that's a little bit of we're going to wait and see. At the moment, we're still kind of getting all the details as this schools out. We know that they've said Silicon Valley Bank depositors, you can start taking out your money on Monday, which is just really the first business day after the bank failed on Friday. It's just pretty incredible because you know, the fd i C doing this is obvious, such a huge step, and it's such a such a big move to reassure depositors and savers because as we know, a lot of like bank run situations, it's just psychology, it's contagion, and so communicating that we're going to be there as this sort of backstop and even a bigger way than before, you know, it shows how concerned they are about it. But it also should give some reassurance. Yeah, and it also raises the question, so where does this stop? Right we had you had the failure of this bank, and then at the same time that the government announced these extraordinary measures. They also announced that they were taking over another bank, Signature Bank, a bank in New York, and they were going to cover those deposits as well. So we have these two banks that have failed in the span of a couple of days, literally and the government's going to step in and make everyone whole. But you know what happens now that we're worried about perhaps this spreading to other banks, you know, where does it kind of end? I mean, that's true. Although people will talk about how like Silicon Valley Bank was a bit of an outlier, and how they manage their assets and liabilities and in there who their clientele was of startups and vcs, vcs meaning venture capitalists, And I think if you're looking at like a city at JP Morgan A Wells Fargo, your concerns are not going to be as great as with a smaller regional bank that you've never heard of. Let me ask you about that, Suzanne, because these smaller regional banks, two of them have already fallen, are now under a lot of scrutiny, and there's some questions about whether there are other banks that had similar business practices that make them vulnerable. So if you have just your deposits in one of these regional banks a lot of people do. Now, is there a reason to be concerned that those banks are going to be a little bit shakier? I think everybody should maybe want to do a little more research into the bank where their money is in. Right now, it's hard to say. With regional banks, we don't know what's going to sort of come out of the closet here, and it's hard for an individual investor to go on to their regional bank site and figure out, like, what does my bank's balance sheet look like? But it is a good time to sort of understand how the FDSC rules work, to do up some reading on your bank. If it's a bank that maybe you went into because it had the highest interest rate and you don't know that much about it, it could very well be fine, but just take a look. I mean the point that a lot of people are saying to me, and this is very obvious, but it's just to not panic. You know. Any panicking rarely leads to anything good. So I think people should be smart and investigate and sort of take some prudent actions, but not freak out about this. And another thing to underscores that if we're talking about people, the vast majority of people that we're talking about that don't have two hundred and fifty thousand dollars in a bank account or above that, that was never really in play here, right, I mean, that was always covered throughout this whole process. So what we were really trying to see how much the government was going to step in here was about those larger commercial accounts and in the effect in the real economy then is those banks, these regional banks, play a bigger and bigger will have come to play a huge role trillions of dollars in assets at this point industries from wineries in California to tech startups to you name it across the United States. These are the banks that make it work. And what we were all kind of waiting to see was what's the government going to come out swinging, so to speak and do something for all those businesses. And they did. Now the question is was it enough to convince everyone that all the other banks, you know, don't need to panic, and people and businesses don't need to panic, and everyone should just kind of take a chill, so to speak, and take a beat. Ben President Biden came out on Monday with a really forceful speech in which he said, US taxpayers are not going to be on the hook for any losses. And this is an important point. No losses will be born by the taxpayers. I mean to repeat that no losses will be born by the taxpayers. But how can that be if the bank has collapsed, its assets are now in doubt. Who is going to pick up the bill? So there's this big deposit insurance fund. And what the government did when they came out on Sunday and said that they were announcing these extraordinary measures. In addition to saying the taxpayers weren't going to be on the hook, they said that the support for uninsured depositors is effectively going to be recovered from a special assessment is what they're calling it, on banks. So essentially banks are going to have to kick in more money, not just the banks that failed, but other banks as well. What we don't know is the details of that how that's going to work. But essentially there's going to be this special assessment which is going to mean that the other banks have to pay more money back into this fund and the taxpayers, so to speak, you or me or anyone else. President Biden and also the regulators are saying are not in the hook directly. It's going to come from the industry itself. And does the president have the power just to tell banks you have to pay a whole bunch of money to shore up a bank they failed. As the statute is written, My understanding is that when the fund is drawn down, it has to be replenished by the industry. So so there's not anything extraordinary happening here. It's it's basically how it's supposed to work. They are using their special powers, so to speak, or their powers to use it at this time and go about, you know, making sure these uninsured depositors are whole. But they're not coming up with a whole new system by which the other banks are going to have to kick in money. That that's pretty much established in the law. And I always wonder, like, how will that trickle down to the average investor? You know, might whatever the banks sort of have a higher cost. I cynically feel like that's going to trickle through to us and higher fees or less lending or something like that. Well, Susan, it's an interesting point because one of the things that the government really went out of the way to do in its statement when it was announcing all this was they basically said, look, investors, your take in your risks. Right, we're not bailing out shareholders so to speak. Here we're bailing out or they're not using the word bailing out, but they're protecting and making hold depositors. But they really went out of their way to say, look, if you bet on a bank or you bet on a company as an investor, this isn't making you hold. So if you want stock in the bank and the stock went down, they're not going to recoup your losses. Do your research, is what they're basically saying. And they're also saying, you know, the executives that were sitting at these banks which the government came in and took over after they were closed by state regulators, they're all gone too, right. I mean, they essentially said that they're not bailing out executives either. Our conversation continues after the break ben. Another thing that President Biden said in his speech on Monday Day was that he was going to strengthen bank regulations. I think a lot of us remember after the financial collapse in two thousand and eight, two thousand and nine, the Obama administration pushed through some pretty tough bank regulations to keep them from failing. That was over Republican objections, and then some of them were watered down a bit under Trump. What happened then and how did that play into what we're experiencing right now. Yeah, so it took all of I think three days for this to become the latest Washington partisan tug of war. Back in twenty eighteen, there was actually a bipartisan law that was passed by Congress that gave some of these smaller banks and smaller I mean including Silicon Valley Bank and the like. And Silicon Valley was the sixteenth biggest bank in the United States before its failure, so it's not small, but it gave these kinds of banks that aren't the big Wall Street banks you think of, effectively a way out of some of the really really really tough, onerous types of regulations like years least stress testing and some of the stuff that these big banks have to do every year. They're just like thousands of hours of work where the government comes in and really tests if you were in financial distress, would your bank fail. This idea that banks can't be too big to fail again. So they look at how much money do they have in deposits? What would they do if there was a sudden dip in the stock market. That's that's exactly right. And literally, almost since the big post financial Crisis law was passed in twenty ten, everyone calls Dodd Frank really almost immediately, these midsize banks were lobbying, and they're basically saying, we shouldn't be considered the same as Goldman Sacks or JP Morgan because we're not the same. We're basically just your you know, your your friendly neighborhood bank. We take deposits and you know, and we we help businesses, and we're not doing all these things that all these big Wall Street giants are doing. They lobbied, and they and they, and they kept pushing on it and pushing on and pushing on it, and finally, in twenty eighteen, bipartisan group of lawmakers passes a new measure which basically rolls back some of the restrictions they have. Trump signs it in the White House, has a big ceremony, calls it crippling regulations that are basically being stripped away. He says that these types of rules were going to make these banks go away one by one, and everyone seems to be kind of on the same page, except for some of the progressives who said this was really a bad idea, that this was a good thing to do. Fast forward five years later, and almost immediately from the moment Silicon Valley Bank failed, people are pointing to this roll back and saying, if this hadn't happened, we probably would have known a little bit more about what Silicon Valley Bank situation really was. Federal regulators may have been a little more prepared to know under the hood what was going on, and the bank itself would have had to have taken more care and not made certain kinds of bets that effectively, when interest rates shot up, really shot the bank in the foot. And by the way, some of the bank executives that were pushing hard included Silicon Valley Banks CEO Greg Becker, people like Elizabeth Warren are already jumping on that just a day later and saying, you know, look, all these all these bank executives were arguing for this rollback, and here we are, and you know, we already have two banks that have failed. Hey Ben that's funny. I was going to ask you about like what Elizabeth Warren is saying right now, But I also wondered how strong is the banking lobby in Washington. Banks, like a lot of industries in Washington, have a lot of firepower. They have a lot of lobbyists, and you know, they're they're quite good at getting access and oftentimes getting what they want. Suzanne, back to this question of what Biden can do to strengthen bank regulations. We saw them rolled back as Ben was talking about what can they do to prevent this sort of thing from happening? Again? What are regulations in that toolkit? There's a number of things that regulators could do. They could require banks to hold more capital on their balance sheet. You know, when you look at Silicon Valley Bank, they had a very extreme position in their assets and liabilities. Things like that could be more of these sort of stress test related type changes that could be done. But Ben, what do you what do you here? I mean, it's it's it's pretty interesting because the rollback was a bipartisan measure in Congress. So now to really really turn the screws, like perhaps Elizabeth Warren would like or her colleagues would like, Congress almost needs to do something again, and it's already looking like that's going to be hard. You have big kind of divisions already in terms of what Republicans are saying and what Democrats are saying. Unsurprisingly, but this moment, in this like hyperpartisan moment, this it's hard to see kind of a kumbayah where everyone agrees to tighten the screws on on banks right now, so that kicks it to the regulators. And the regulators can do some things, uh certainly, you know, the Federal Reserve, the FDIC, they all have powers and they can do more, but it can only go as far as the law will let them. And then there's a question of what could President Biden do on his own? Is there something he could do through executive action? Those are all the kinds of things I think are gonna have to be ironed out, you know, in the days ahead. He just basically said I want action, but didn't really say how that's going to happen. We'll be right back, Susanne. We started this conversation talking about how it affects individuals and how we can protect ourselves. One way, of course, as you describe as just having kind of good bank account hygiene, making sure that you don't have more money in the bank if you're so lucky than the limit allows. What else can people do just to stay safe in a time of volatility, right, I think we're in such a an out of control seeming environment that just, you know, taking controlling what you can control is really important. And when I was speaking with a financial planner earlier, he said that one of the biggest you know, quote air quotes some mistakes that he sees that people stop investing when they're feeling nervous. So, you know, when you're you know, you're putting away however much you can and four one K and you're like, oh, things are kind of crazy. I think I'll step back and maybe lower my you know, the percentage of my salary that I have going into my four one k. You know, that is really not the greatest thing to do, because a lot of times when people dial back their savings, they sort of forget to go back in and dial it up. So just sort of resisting the urge to stop a really good savings habit, if you have one, is something to keep in mind in the midst of all this turmoil, Suzanne, what about just other kinds of investments stock marketed bonds. Are there things that people should be doing now in the wake of this to kind of give themselves an extra layer of protection or comfort. I think people should take a look at their portfolio and make sure that they're still comfortable with the level of risk that's in their portfolio. You know, if they have a portfolio that's seventy percent in stocks thirty percent in bunds, they should take a look and make sure they're still comfortable with that split. But I think anybody who has a good long term plan or maybe as in say a target date fund, which is a kind of fund in the many four one ks have that is sort of geared toward a long term time horizon, and you don't want to make any rash moves to upset long term plans, because what we've seen in so many market crashes and panics over the decades is that it's the people who panic who sometimes just get hurt the most. And Susanne, that's that's exactly what the US government is trying to impart on everyone by what they've what they've done so far, everyone's trying to say, don't panic, just kind of hanging there, and the fact that the US governments stepping in with extraordinary measures. They really want people to feel assured that their money is going to be okay, They're going to be able to make payroll if they're running a business. And the question is is are all these other banks who may have been similarly positioned in terms of what they were holding on their balance sheet as the ones that have gone down, are they going to be okay? Are they going to be able to weather this? And that's the big question. Ben. You're covering all the ups and downs of this story as the fallout continues. I think we're probably gonna be talking about this for weeks to come or longer. What are you watching for? What are the things that you're especially looking for as the story keeps going. So far, we've had two banks fail in the span of less than a week and one bank voluntarily liquidate. The bank that failed, Silicon Valley Bank, was the biggest bank failure since two thousand and eight. What that means is everyone is un high alert. Everyone is trying to figure out our other lenders potentially at risk. If you look at the market moves If you look at regional lenders stocks, there's a lot of jitters out there. A bunch of firms are seeing massive declines in their share price. The question is has the government done enough to convince people that they've dealt with the problem. This was an isolated situation to a few institutions and everyone's going to be fine and we can move on. Or is this going to continue to kind of cascade? Is this going to be more of a domino situation. That's what I think everyone's watching right now. Ben Bam, Suzanne Willie, thanks for coming on the show. Thank you, Thanks guys, thanks for listening to us here at The Big Take. It's a daily podcast from Bloomberg and iHeartRadio. For more shows from my Heart Radio, visit the iHeartRadio app, Apple Podcasts, or wherever you listen, and we'd love to hear from you. Email us questions or comments to Take at Bloomberg dot net. The supervising producer of The Big Take is Vicky Virgolina. Our senior producer is Catherine Fink. Michael Fallero is our producer. Our original music was composed by Leo Sidrin. I'm west Kasova. 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