Only a short time later, the US government, with JP Morgan and other major banks, orchestrated a 30 billion bailout of the third ailing US bank First Republic. JP Morgan? There’s something ringing about the name: JP Morgan has come into play whenever there’s a fire since the Panic of 1907.
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After all, the banks took responsibility, the signal was important. Even if the various rescue measures immediately raised the “moral hazard” problem: “How bad was the Silicon Valley bank bailout?” asked the Nobel Prize winner Paul Krugman in seiner „New York Times“-Kolumne. And he outlined the dilemma of every financial crisis: As a politician, he too would become the Silicon Valley Bank „don’t like to fail”. It’s likely their demise wouldn’t have caused a major crisis — but you can’t be entirely sure. “And the risks of doing too much were far less than the risks of doing too little.”