Events in March last year showed that the financial system remains much too fragile and that bailouts persist despite promises that new rules would end them. Yet authorities failed to address the underlying problems. Flawed narratives continue to drive policies that enable bankers to benefit at the expense of society and prevent us from having a healthier system.
When Silicon Valley Bank failed, the most shocking fact was not the deposit run or the role of social media but the supervisors’ failure to recognise the bank’s technical insolvency months earlier. Even today, official narratives ignore the solvency problems that eventually caused the run and the flaws in the rules that allowed these problems to remain hidden.
