Here’s why the Trump administration is being blamed for the collapse of the Silicon Valley Bank

A lot is being discussed about the Silicon Valley Bank collapse. But, without wasting much time, you certainly wish to know how the Trump administration is responsible for the same. Well, the one-line answer is the deregulation law that eased Dodd-Frank financial regulations back in 2018. And now, a team of Democrats, led by California’s Rep. Katie Porter and Sen. Elizabeth Warren of  Massachusetts, is set to correct this mistake. 

While introducing the bill in 2018, Trump claimed the step intended to remove excessive bureaucracy. Back then, Sen. Warren had warned that the move might enable midsize banks to take excessive risks, resulting in potential problems for the economy.  

The bill to repeal the Trump-era law will be introduced on March 21, 2023. Further, midsize banks (with assets up to $50 billion) will face more scrutiny to help prevent bank failures. 

As pointed out by Porter, the bill will bring back confidence in the country’s financial system by restoring common-sense guardrails. Yes, it reinstates stress tears and capital requirements that were in place until the introduction of the 2018 law.

(The post was first published on my website)

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