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SVB Collapse

Stock Market Miracle Collapses on Systemic Angst Spurred by SVB

  • SVB, Silvergate collapses fan concerns over contagion risk
  • Saving grace for stock bulls is that Fed will ease up hikes
An SVB Financial Group chart on the floor of the New York Stock Exchange on Friday.

An SVB Financial Group chart on the floor of the New York Stock Exchange on Friday.

Photographer: Michael Nagle/Bloomberg

It’s one thing when crypto gets flattened by a fired-up Federal Reserve, or moonshot online stocks fall back to earth as rates soar. But when central bank policy starts biting into banks, investors know they have bigger problems on their hands.

Fear of systemic risk ripped across markets this week, when investors who thought they’d survived the worst of Jerome Powell’s war against inflation suffered their biggest stretch of losses in five months. Bank shares, assumed to be redoubts of safety in a rising-rate world, led the plunge, posting their worst week since the Covid crash.