By Chris Wright, 3/13/23
Dennis Prager likes to say the Left destroys everything it touches. Now it’s destroying banking.
Silicon Valley Bank (SVB), the nation’s 16th largest, went belly up and was taken over by regulators. The story starts with Joe Biden’s inflationary spending, which led to the Federal Reserve raising interest rates to fight inflation. SVB had way more money in deposits than it could lend, so it bought fixed-rate securities, betting heavily interest rates wouldn’t rise. These securities were more than half the bank’s assets and the bank blew up when the value of these holdings went down after interest rates went up.
But that’s only part of the story. The bank lent heavily to Chinese tech start-ups, China figuring heavily in scandalous Biden family business dealings. Employees at the bank were big Democrat donors. Almost all their political contributions went to Democrat politicians, including Joe Biden, Kamala Harris, Pete Buttigieg, and Raphael Warnock. A PAC affiliated with the Democratic National Committee (DNC) also benefitted.
SVB bankers were all in for pet left-wing causes, such as environmental, social, and governance investing (ESG). In 2022, the bank trumpeted it “Commits to $5 Billion in Sustainable Finance and Carbon Neutral Operations to Support a Healthier Planet.” The bank’s CEO said, “Our ability to make a meaningful difference for people and the planet, and to address the systemic risk that climate change presents, is magnified by the outsized impact our innovative clients make.” Studies show ESG investing underperforms standard investing which is why sensible states are pulling their retirement money out of firms that traffic in ESG.
Bernie Marcus, a co-founder of Home Depot, blamed banks getting into ESG investing on the Biden administration. “I think that the system [and] the administration has pushed many of these banks into [being] more concerned about global warming than they do about shareholder return,” he said.
You might recall, it was the Democrat Clinton administration’s pushing banks into making unsound housing loans to minorities they couldn’t afford that produced the ‘mother of all financial crises’ in 2008. Another triumph of social factors over sound investing, of important values being sacrificed on the altar of diversity.
Bernie Marcus also said, “these banks are badly run because everybody is focused on diversity and all of the woke issues and not concentrating on the one thing they should, which is shareholder returns.” That was certainly true at SVB. There was no chief risk officer at SVB from last April until January. The bank’s European risk officer prioritized diversity initiatives over risk compliance. Jay Ersapah self-describes as a ‘queer person of color from a working-class background.’ That’s a lot of diversity boxes checked by one person, no wonder they hired her. Too bad Woke Identity has nothing to do with qualifications and competency. This person spent her time cooking up diversity initiatives for the bank. She organized LGBTQ programs like Lesbian Visibility Day, Trans Awareness Week, a month-long gay pride celebration, and safe spaces for staff. She was featured in a corporate video that burnished the bank’s LGBTQ credentials.
Go Woke, Go Broke, as the saying goes. The only thing missing from this picture is Sam Bankman-Fried, the Democrat toady and corruptocrat who destroyed cryptocurrency because he was preoccupied with being a top donor to the Democrat Party and left-wing causes. A pattern is starting to emerge, the joining of Democrat Left-wing ideology with financial corruption producing disastrous results. We have two dots to connect now – SVB and SBF. There are more out there, I guarantee it. We just don’t know about them yet. And these people want power over us – no way!
Watch Eagle Headline News – 7:30am ET Weekdays
– The 6 Top Stories in One Minute