It is said that the U.S. has again asked Warren Buffett for help in a financial crisis.
In 2008, after Lehman Brothers went bankrupt, the billionaire investor bailed out Goldman Sachs. In 2011, he did the same for Bank of America.
Now, during this year’s regional banking crisis, Buffett has been in touch with the White House, offering advice and guidance and also talking about making an investment in the sector.
In the past week, after Silicon Valley Bank failed on March 10 and Signature Bank failed two days later, the government has tried to reassure the public.
In a speech March 13, President Joe Biden told Americans they “can rest assured our banking system is safe. Your deposits are safe.”
Politicians on both sides of the aisle have still called for tougher measures to be taken against the banking industry. In the same speech, Biden asked for a “full accounting” of what happened to cause the failure of two banks.
Later in the week, the top Republican and Democrat on the House Financial Services Committee said they had set up a hearing for later this month to question top officials from the Federal Reserve and the Federal Deposit Insurance Corp.
“The House Financial Services Committee is committed to getting to the bottom of the failures of Silicon Valley Bank and Signature Bank,” Republican Patrick McHenry and Democrat Maxine Waters said in a news release. “This hearing will allow us to begin to understand why and how these banks failed.”
Late in the week, worries about the industry continued, and 11 big banks worked together to give another regional bank, First Republic of California, $30 billion.
“Last weekend felt like the wild, wild West,” Charlie Youakim, CEO of payments startup Sezzle, said, CEO Karen Webster soon after the SVB failure. “SVB had been around for a long time, and their brand was great. Its fall is a big surprise to me.
Now, he said, people are becoming more careful about where they keep their money, so there is a conversation going on about the future of banking.
“We’ve got a board meeting later this week to go over the set of banks that [Sezzle] works with,” said Youakim. “We’re putting together a report of what these banks look like, their financial stability … because it’s not the case anymore that you can just trust your bank, trust that your money will be safe.”
