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politico OP t1_jcb5l2d wrote

Reply to comment by ITinMN in We’re POLITICO econ/finance reporters and a bank regulation expert. Ask us anything about economic politics and policy after Silicon Valley Bank’s shocking collapse. by politico

>ITinMN

Hey, Steven here from the Yale Program on Financial Stability! Indeed, financial distress was definitely an expected outcome of the Fed's interest rate hikes. They very explicitly wanted to tighten financial conditions - and banks are huge part of the financial sector. The Fed is (awkwardly?) also in charge of bank supervision - i.e. making sure banks are resilient. And it has a financial stability mandate. It seems the Fed wants tighter financial conditions, but only outside the core banking system

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politico OP t1_jcb7h1s wrote

Sam here: Was talking to Steven about this offline and, as he put it to me, shocking is a point of view. Not to sound like a reporter who was caught flat-footed -- I swear that never happens -- I do think the speed with which this run occurred, and the level of financial sophistication of the industry it most heavily impacted, was fairly shocking. But I definitely defer to Steven on this.

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