Photo: Getty Images
High-profile venture capitalists took to their Twitter feeds (because, of course they did) and started/fomented/encouraged a bank run that led to the 16th-largest U.S. bank to fail.
Not a great look, guys. J.P. Morgan is disappointed you didn’t follow his example from 1907, back when he, you know, utterly saved the nation’s banks – and the American economy along with its financial sector.
These VCs are the absolute first to piss and moan about business regulations, including stress tests for banks, but somehow also are at the front of the line with hands out when the Feds have to get involved and bailouts are being discussed, if not de rigeur.
That’s some waist-deep (redacted) right there. The lure of Libertarianism usually grips 19-year-olds who read Ayn Rand and fancy themselves the next Jon Galt – until actual reality, social contracts and citizenship roll up their sleeves and batter that dystopic notion out of them. Usually around age 19.5 or 20. That’s not the scenario with several big-name, whale-ish venture capitalists.
Congratulations, Silicon Valley: the back pats that landed on Patagonia vests are over. (Btw, Patagonia was never a fan of their merch becoming a tech cliche, but I digress.) The Valley has graduated into a new phase of its economy. Jobs will continue to be created via technological innovations. Banks just won’t have to endure these self-serving [redacted] libertarians quite as much as before. Don’t expect the mega banks to be nearly as cool with zero-revenue business models, either.
Not to linger too long here, but regional banks are important – vital – to the American economy. If you’re a depositor, you’re fine. If you’re an investor, the present ‘sell now, ask questions later’ phase will soon pass.
And when that phase passes, brace for the policy changes in the financial sector. Pols and moralists can’t wait to display their schadenfreude. Turns out, Silicon Valley earned it.
Additional notes and links:
- Our interviewee this week, Bill Porter, has his online marketing firm here.
- No Mercy; No Malice article from Professor Galloway (first-ever guest on Macro for a reason)
- Broadcast Standards & Practices (or, Why Jason Can’t Use the Words He’d Like to When Describing These [redacted] VCs and Their Behavior)
- Where You Can Watch Fed Chair Jay Powell on Wednesday for Rate Hike (Or Not)