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00:00Do you agree with that, that it's the central bank's fault? Well, certainly the word temporary that they used in 2020 was very and twenty one was very unfortunate because inflation wasn't temporary. It's obvious now that the structure of communities. Now, I think, though, in this banking crisis, in a way I would characterize as the banking crisis of the rich. If you think about it, SVB was the bank, Silicon Valley, all the tech guy startups and all the venture capitalists. I mean, the average deposit was more than 10 million dollar man. That's not a retail bank. That first republic, which is the bank of a hedge fund manager and the private equity guys in New York, they panic, too. And Credit Suisse was the bank of the global rich. So the funny thing is, this time banking crisis happens when banks make bad loans. It's an asset problem. This time, assets are fine. It's a liability problem. And guess what? It's in banks which have they're not the normal bank. A normal bank has 10 hundred million deposits per branch here. Silicon Valley Bank had 10 billion. So in a way, it's institutional and run very concentrated clientele, all billionaires. And they all panicked. They're all on social media. And all of a sudden it says, oh, wow, I don't trust it, just move. But that's not what's going to happen to of banking system. That's what I want to make it very clear. So if you want a safe, sound bank, don't don't bank to billionaires. Well, I would say billionaires are actual media. I mean, maybe the question raised is how smart that is billionaires. If they had little big man in any banks, they're going to have a bank run in three days. Maybe not. That's not.

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This Is the Banking Crisis of the Rich: Algebris CEO

Davide Serra, founder and CEO at Algebris, characterizes the current issues in banking as “the banking crisis of the rich,” saying, “this time, assets are fine, it’s a liability problem.” He speaks with Francine Lacqua at the Bloomberg Invest conference in London on Wednesday. (Source: Bloomberg)

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