Skip to content

The chaos agent behind the collapse of Silicon Valley Bank is . . . Slack?

The Wall Street Journal explains today how panic about Silicon Valley Bank spread throughout Silicon Valley last week:

On Wednesday, the bank announced it had sold a chunk of its holdings at a loss and would sell a slug of stock to raise cash....Slack and WhatsApp groups lit up across the startup scene.

....“For startups, all roads lead to Silicon Valley Bank,” said Varun Badhwar, chief executive of Endor Labs....Mr. Badhwar had paid little attention to the bank’s situation until Thursday morning when, at around 10:30 a.m. California time, an employee noted on Endor’s Slack channel that SVB’s shares were in free fall.

....On Thursday morning, founders and CEOs were posting tweets about SVB’s financial woes in private Slack channels. Mr. Rizqi decided to move a portion of his money, but the online banking portal wasn’t working. He spent a few hours furiously refreshing his browser. By afternoon, Slack was buzzing with messages from people moving all their money out of SVB.

I tried to warn you that Slack was dangerous and uncontrollable, and now look what happened. It destroyed Silicon Valley's favorite bank. Now will you listen to me?

18 thoughts on “The chaos agent behind the collapse of Silicon Valley Bank is . . . Slack?

  1. Anandakos

    There's a "Mr. Rizqi" [doutbless pronounced "Risky"...] who was heavily invested in SVB? Sirens should have been going off! Jes' sayin'

    1. Eve

      Google paid 99 dollars an hour on the internet. Everything I did was basic Οnline w0rk from comfort at hΟme for 5-7 hours per day that I g0t from this office I f0und over the web and they paid me 100 dollars each hour. For more details
      visit this article... https://createmaxwealth.blogspot.com

    1. Anandakos

      No, they didn't. They're NOT "bailing out" SVB and Signature. The stock- and unsecured bondholders in those two corporations have suffered a total loss. Holders of bonds secured by specific collateral will probably get something, but not much.

      Is there systemic risk here? Yes. The Fed and Treasury have essentially said that if a bank is big ENOUGH, but so big to be in the Fed's stress test cohort, corporate depositors with more than the statutory limit of cash in the bank are now insured. If Congress is wise it will say that no insured bank can hold accounts for more than $250,000. Otherwise there will be a steady drip-drip-drip of these things.

      Large corporations will simply have to manage their cash themselves and set up "bank-like entities" connected to the SWIFT system.

      Since money at that level is all just digital nowadays, they should be able to do with by spreading their money over a bunch of money market vehicles -- enough that one going TU is no big deal to the corporation -- and pay people out of them.

  2. bhommad

    Whether it was caused by Slack, woke, or Obama we've still got to save this bank. It's backstopping the startups, and if it goes under we could lose five or six potential Juiceros.

  3. dilbert dogbert

    I lost my one small connection to Sequoia Capital. It would be interesting to hear if Sequoia had a finger in SVB. I know they had their dick caught in the SFB zipper. They did What's Ap and made a bundle.

  4. Anandakos

    I just read an article in the NYT that SVB was the biggest loan originator for Climate projects and that a bunch of alternative energy start-ups had their cash there too.

    Given its centrality to Climate development does ANYbody doubt that that jerk Peter Thiel deliberately tanked the bank? Sure, he probably had a big short against it so he made a bundle. But his main objective was to crap on alternative energy.

  5. Traveller

    Hummm, Anandakos....that is interesting. I am not adverse to doing short sales, but have been terrified to play over the past year in this crazed market environment.

    I am anti Thiel in every generalized sense and have posted this opinion with my homework across various sites:

    SVB Financial CEO Sold $3.6 Million In Stock Before Bank’s Collapse

    https://www.forbes.com/sites/brianbushard/2023/03/10/svb-financial-ceo-sold-36-million-in-stock-before-banks-collapse/?sh=1f89c334b2a6

    And...Thiel's hidden thumb on the scales of justice

    https://finance.yahoo.com/news/thiel-founders-fund-withdrew-millions-005223787.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAGI2Kz7i_xkn21s5VSy4TZoQipFKKt0SjAlI0QCxtaksY7BUL8ckUYZ3LpyG8cTdsn6dimVAW-kxWOeJJhl2UifwuB6NCJhmTdCPnAGyC1QuJuEmRoeYQGfN2zmEUYXcfm13DyTzThB0uz6AhYdLFpGj_dXxb_wlIGv2dbmff2Ia

    Alas, Uncle Joe has been forced to lie through gritted teeth:

    “I am firmly committed to holding those responsible for this mess fully accountable and to continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again.”

    Ha!

    Traveller

  6. Pingback: सोशल मीडिया आतंक - Expert Hindi News

  7. Pingback: Faillite de la Silicon Valley Bank : une panique dopée aux réseaux sociaux – lepolitique.net

  8. Pingback: une panique dopée aux réseaux sociaux - Crypto-Blockchain

  9. Pingback: Silicon Valley Bank bankruptcy: social media panic - Style Life World

Comments are closed.