We begin today with Kristoffer Tigue of Inside Climate News showing the extent to which Republicans have blamed “wokeness” for multiple bank collapses this weekend.
Republicans are blaming the collapse of two major banks over the weekend on “woke” investment practices, once again dragging the effort to address the climate crisis into America’s increasingly polarizing culture wars. But their reasoning doesn’t align with assessments from leading economists who have mostly tied the bank failures to risky bets on cryptocurrency—not clean energy—and the plummeting value of government-backed securities amid rising interest rates.
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According to analyses by Baker and other well known economists, the fall of Silicon Valley Bank, which held some $220 billion in assets and was America’s 16th largest commercial bank before its collapse Friday, was tied largely to the bank’s decision to buy up government bonds amid the tech boom between 2019 and 2022, when many Silicon Valley companies were flush with cash.
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With deposits skyrocketing and demand for loans relatively low, the bank chose to invest the bulk of that money in government bonds, he said, which tanked in value as the tech boom faded and the Fed raised interest rates to curb inflation. As clients began asking for their money back, Silicon Valley Bank was forced to prematurely sell $21 billion in bonds at a $1.8 billion loss, triggering an old-fashioned bank run, Rubinstein concluded.
Signature Bank’s collapse can be explained even more simplistically. As the finance trade publication Barron’s noted in its apt analysis, “the bank’s connections with cryptocurrency seem to have spooked depositors after Silicon Valley Bank collapsed, prompting a run on the bank’s deposits which, in turn, prompted action from regulators.”
“Wokeness” and the so-called “culture wars” have become a ludicrous Republican unified field theory of every American failure no matter how large or small. It would be funny if it weren’t so dangerous.
This from the party of personal responsibility.
Simon Reed and Natalie Sherman of BBC News report on Credit Suisse borrowing up to 50 billion francs to shore up its books.
Shares in Credit Suisse fell 24% on Wednesday after it said it had found "weakness" in its financial reporting.
This prompted a general sell off on European markets, and fears of a wider financial crisis.
Credit Suisse said its borrowing measures demonstrated "decisive action to strengthen [the bank]".
"My team and I are resolved to move forward rapidly to deliver a simpler and more focused bank built around client needs," Credit Suisse's chief executive Ulrich Koerner said in a statement.
Problems in the banking sector surfaced in the US last week with the collapse of Silicon Valley Bank, the country's 16th-largest bank, followed two days later by the collapse of Signature Bank.
Laura He of CNN reports that overnight Asian bank stocks tanked in the wake of the Credit Suisse news.
Japan’s Topix Banks Index, a key index that tracks Japanese lenders, tumbled as much as 6.4% in the morning session. It then trimmed some losses and was last trading 3.7% lower. The index has lost more than 8% so far this week.
In Hong Kong, Standard Chartered (SCBFF) sank nearly 4%. HSBC Holdings (HSBCPRA) dropped 2.5%. Local bank BOC Hong Kong was down 3.1%.
In South Korea, major lenders Shinhan Financial Group and KB Financial Group declined 1.2% and 0.5% respectively.
“What we are seeing is a definite unravelling of investor confidence across both the tech and banking sectors,” said Clifford Bennett, chief economist at ACY Securities, a Sydney-based online broker. “It is highly unlikely these concerns are going to simply vanish any time soon.”
“Regardless of balance sheets, a loss of confidence by investors and depositors can bring down any bank,” he added.
Jerusalem Demsas of The Atlantic interviews former Treasury official and Yale Law School professor Natasha Sarin about what financial regulators need to do to prevent bank runs of the type that caused the collapse of Silicon Valley Bank.
Sarin thinks that many of us are asking the wrong questions. Instead of focusing mostly on what to do after banks suffer this type of financial distress, federal regulators need to get better at forecasting errors before they become crises. And to do so, they’re going to have to update how they determine whether banks are in good standing.
In our conversation, Sarin described a regulatory system that failed to detect the market’s growing trepidation with SVB and similar banks. In part, regulators were hobbled by 2018 changes to financial regulations that exempted banks with assets below $250 billion from some oversight measures, including the yearly stress testing that larger banks undergo.
In lobbying for those changes, SVB and other regional banks argued that they weren’t systemically important. But clearly, the federal government now disagrees, having guaranteed deposits above the official $250,000 Federal Deposit Insurance Corporation threshold out of concern that failures at SVB and Signature Bank could spiral across the system. In fact, despite federal regulators’ steps to restore confidence, on Monday, the stocks of several regional banks plummeted, reflecting ongoing fear and uncertainty working their way through the market.
If regional banks are not systemically important, the level of public intervention in the SVB crisis is hard to justify. The other possibility is that our laws don’t match reality—making the current regulatory regime untenable.
Claire Malone of The New Yorker says that Fox News has no real incentive to change it ways, even in the aftermath of revelations stemming from the Dominion Voting System defamation suit against Fox.
During the past few weeks...texts and e-mails from Fox News hosts have been made public in Dominion Voting Systems’ defamation lawsuit against Fox, which claims that the network knowingly aired false allegations that the election was stolen from Trump, at least in part, with the help of Dominion’s products. “I hate him passionately,” Carlson said of Trump in one text message. According to Laura Ingraham, another of the network’s prime-time hosts, Trump’s attorney Sidney Powell, who peddled election lies on the network, was “a bit nuts.” Fox News’ lawyers have argued that Dominion has taken the communications out of context and “has not even identified any defamatory statement of fact . . . attributable to Fox News.” Much of the non-Fox News media, meanwhile, has crowed at tangible evidence of the network’s duplicitous coverage and speculated about whether any of it will force Fox News to reform. “The documents lay bare that the channel’s business model is not based on informing its audience, but rather on feeding them content—even dangerous conspiracy theories—that keeps viewers happy and watching,” CNN’s Oliver Darcy wrote. Margaret Sullivan, in a column for the Guardian, asked if a Fox News loss in the lawsuit might “make coverage more responsible.”
But, despite the bad headlines, Fox News has little incentive to change its ways. For one thing, the network’s loyal audience is likely to remain glued to their screens, especially as a contested G.O.P. Presidential primary plays out on-air over the next two years. Thanks to that audience, the rate that Fox News charges cable companies to carry its shows is the highest among cable-news providers. So long as its ratings remain high, the network can negotiate fat fees. There’s been some suggestion that the recent disclosures about Fox News hosts’ conversations behind the scenes, particularly a seemingly shared disregard for Trump among some of them, could erode viewership numbers. But a cable executive I spoke with seemed confident that the network would remain largely unaffected. “The audience is not going anywhere,” they said. “Fox may be forced to read an apology on air or something, but the audience still loves the product. It’s basically the W.W.E. for this kind of world.”
I had to laugh at this story by Erik Wemple of The Washington Post reporting that Fox News filed a motion in its’ defense against Dominion Voting Systems—for the redacted text in court documents to stay redacted so that other media companies do not steal Fox News’s “journalistic processes.”
[A] motion that Fox News filed on Friday may outpace all the internal correspondence for sheer risibility. It argues that the Delaware court presiding over the case should maintain the confidentiality of discovery material already redacted by the network, shielding it from the public’s curious eyes. As anyone who has read through the Dominion filings can attest, swaths of black lines cover passage after passage in briefs and exhibits. Could the redacted text be as scandalous as the public text?
Fox News lawyers say one reason for the confidentiality is that competitors will pounce: “Prematurely disclosing these other details on Fox’s internal and proprietary journalistic processes may allow competitors to appropriate these processes for their own competitive advantage, to Fox’s detriment, and may chill future newsgathering activity,” the filing reads.
Hold on here. Given the revelations that have emerged thus far from the litigation, what “journalistic processes” are in place at Fox News, proprietary or otherwise? And if another media organization moved to “appropriate” them, wouldn’t its editor in chief be sacked?
New polling from Quinnipiac shows that Number 45 appears to have slightly increased his advantage over Florida Gov. Ron DeSantis for the 2024 Republican presidential primary.
In an early look at the 2024 Republican presidential primary, 46 percent of Republican and Republican leaning voters support former President Donald Trump, who has declared his candidacy, and 32 percent support Florida Governor Ron DeSantis, who is seen as a potential candidate, according to a Quinnipiac (KWIN-uh-pea- ack) University national poll released today. Former United Nations
Ambassador and South Carolina Governor Nikki Haley receives 5 percent. Of the remaining 12 listed declared or potential candidates, no one tops 3 percent of the vote. Trump has widened his lead over DeSantis. In Quinnipiac University's February poll, Trump led DeSantis 42 - 36 percent.
In a head-to-head Republican primary matchup between the two leading Republican candidates, Trump receives 51 percent support and DeSantis receives 40 percent support.
Kristen Holmes and Jason Morris of CNN report on an Atlanta Journal-Constitution exclusive that Fulton County investigators have a recording of Donald Trump to the Georgia House speaker that was made in the aftermath of the 2020 presidential election.
The recording adds to what’s known about the pressure campaign by Trump and his allies on Georgia officials. It’s the third audio recording of the former president’s phone calls to Georgia officials that is known to exist.
The special grand jury recently concluded its work and recommended multiple indictments, according to the foreperson who has spoken out publicly. Now it’s up to Fulton County District Attorney Fani Willis to make charging decisions.
Ralston, who died last year, described his December 2020 call with Trump during an interview the following day.
Trump “would like a special session of the Georgia General Assembly,” Ralston said. “He’s been clear on that before, and he was clear on that in the phone conversation yesterday. You know I shared with him my belief that based on the understanding I have of Georgia law that it was going to be very much an uphill battle.”
According to the Georgia Constitution, not only can the governor convene a special session, the General Assembly can call itself into a special session, though that requires the signatures of 3/5 of the Georgia House.
Charles Blow of The New York Times asserts that Number 45 must be prosecuted.
Last year, around the time the House Jan. 6 committee was holding hearings, Elaine Kamarck, the founding director of the Center for Effective Public Management at the Brookings Institution, wrote: “Prosecuting Trump is not a simple matter of determining whether the evidence is there. It is a question embedded in the larger issue of how to restore and defend American democracy.”
I don’t see it that way. Any case against Trump must hang on the evidence and the principle that justice is blind. The political considerations, including gaming out what might be the ideal sequence of cases, across jurisdictions and by their gravity, only serve to distort the judicial process.
The justice system must be untethered from political implications and consequences, even the possibility of disruptive consequences.
For instance, could an indictment and prosecution of Trump cause consternation and possibly even unrest? Absolutely. Trump has been preparing his followers for his martyrdom for years and evangelizing to them the idea that any sanctioning of him is an attack on them. This transference of feelings of persecution and pain from manufactured victimhood is a classic psychological device of a cult leader.
Wojciech Kość of POLITICO Europe reports that the ruling party in Poland is poised to take political advantage of a documentary that purports to expose the culpability of Pope John Paul II in the protection of priests accused of sexually molesting children.
Although the canonized Polish pontiff has been dead since 2005, he’s become the hottest subject in Poland following an explosive documentary aired by the U.S.-owned broadcaster TVN, alleging that when he was a cardinal in his home city of Kraków, he protected priests accused of sexually molesting children.
That caused a collective meltdown in the ranks of the ruling nationalist Law and Justice (PiS) party, which is closely allied with the powerful Roman Catholic Church.
U.S. Ambassador Mark Brzezinski was even summoned (later toned down to “invited”) to appear at the foreign ministry.
In a statement, the ministry said it “recognizes that the potential outcome of these activities is in line with the goals of a hybrid war aimed at causing divisions and tensions within Polish society.”
PiS also pushed through a parliamentary resolution “in defense of the good name of Pope John Paul II.”
Maxim Trudolyubov of the independent Russia media outlet Meduza writes that in order to stay in power (and, perhaps, to stay alive), Russian President Vladimir Putin cannot end the war with Ukraine.
It has become a habitual gesture for Vladimir Putin to divest himself of responsibility. One of his oft-repeated phrases, “we didn’t start this war, but it is our job to end it,” might have sounded less out of place if spoken by Volodymyr Zelensky. In fact, it did come from Zelensky’s 2019 inaugural speech, in which the newly-elected Ukrainian president said precisely this, referring the Russian-occupied Donbas. Putin has coopted Zelensky’s maxim without so much as crediting the source. Coming from Putin, though, the phrase rings hollow and false, not just because he did, in fact, “start this war,” but also because he is utterly incapable of ending it.
This incapacity is rooted in the political system Putin himself has created, part of which is the disorganized, unwieldy, and uncontrollably violent military that doesn’t stop at crimes against civilians. No leader can conduct a war marked by atrocities like those that shocked the world when the Russian army retreated from the Kyiv region, without forfeiting his chances of shaping the conditions for peace. As a leader, Putin cannot extricate himself from this war without facing the gravest accusations and possibly even threats to his life. As a result, his only way out of warfare is to crush the adversary, if he can. But given how big an ‘if’ this is, his best option is to perpetuate the war, since any conditional peace would probably mean Putin’s removal from power, followed by severe repercussions.
Finally today, Olivier Faye of Le Monde in English notes that French President Emmanuel Macron is far from the first French President to call for an end to France’s meddling in the internal affairs of its former African colonies.
2023: Emmanuel Macron's promise of neutrality
More than 60 years after the end of colonization, the "age of 'Françafrique' is well and truly over," said Emmanuel Macron on March 2 in Libreville, Gabon. The French president said that France has even become a "neutral partner" on the African continent, a far cry from the political and economic interference that had prevailed following independence.
A new reality, reflected in the promise of a "visible decrease" in French military presence. Nonetheless, this did not stop the tenant of the Élysée Palace, during his four-day tour of Central Africa, from meeting with Congolese President Denis Sassou-Nguesso. The latter has been in power for more than 40 years and represents the legacy of past relations. […]
1990: The stipulations of François Mitterrand
"France does not intend to intervene in the internal affairs of friendly African states," said François Mitterrand on June 20, 1990, before 37 heads of state and government gathered for a summit in La Baule (Loire-Atlantique). This "subtle form of colonialism, under which France would attempt to coordinate internal political changes through plotting or conspiring" is over.
Have the best possible day everyone!