Given the antipathy towards Wall Street bailouts in the 2008 crisis, Biden is at pains to stress that ‘no losses’ will be borne by taxpayers
But someone has to pay. US banks, particularly regional banks, are believed to be sitting on $620bn in losses from moves in Treasury bond prices where they placed customer funds during the decade when the US central banks held interest rates at effectively zero.
Funding for the non-bailout bailout will also come from selling off SVB and Signature assets, pegged at $212bn and $110bn respectively. Thus, the theory goes, taxpayers will not be directly affected by the turmoil in the banking sector.. “Joe Biden’s words of reassurance did little to calm markets as worries raced around that other smaller US banks could become the latest dominos to fall,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
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