Former President Donald Trump fueled speculations of doom and gloom as he dove into the news surrounding the collapse of Silicon Valley Bank.
“With what is happening to our economy, and with the proposals being made on the LARGEST AND DUMBEST TAX INCREASE IN THE HISTORY OF THE USA, TIMES FIVE, JOE BIDEN WILL GO DOWN AS THE HERBERT HOOVER OF THE MODERN [sic] AGE,” Trump exclaimed on Truth Social. “WE WILL HAVE A GREAT DEPRESSION FAR BIGGER AND MORE POWERFUL THAN THAT OF 1929. AS PROOF, THE BANKS ARE ALREADY STARTING TO COLLAPSE!!!”
Trump was referring to Silicon Valley Bank’s abrupt demise on Friday following a bank run. The development sparked worries of an upcoming economic crisis in the absence of government intervention, as well as concerns that other smaller, regional banks may face a run in the following days.
While The New York Times reported uncertainty about whether this is the start of a larger trend, they noted that Silicon Valley Bank is now “the biggest American bank to fail since the collapse of Washington Mutual in 2008, at the height of the global financial crisis.” This is sure to stir public debate over banking laws, and squabbles over who is to blame for the bank’s collapse have already started. Silicon Valley is the nation’s second-biggest bank to fail.
In an interview given hours after Trump’s Truth tweet, Treasury Secretary Janet Yellen tried to bring back calm in the US banking system. When asked if she was working on a deal to relieve anxiety before the markets reopened, Yellen said “We certainly are working to address the situation in a timely way.”