Yesterday, along with many, many others, I mentioned a major  financial concern: 

The problems of two small banks on the West Coast are rippling across markets and causing new investor concerns about some of the country’s largest financial institutions.

Why? Three words: rising interest rates [italics added].

The Federal Reserve’s aggressive campaign to bring down inflation helped set the stage for major problems at two California lending institutions — SVB Financial (SIVB) and Silvergate Capital (SI) — as an outflow of deposits forced both to sell assets at a loss. Those assets were bonds.

BOOM!  BOOM!  POW!  Friday it happened: Silicon Valley Bank (SVB), the U.S.'s 16th largest according to the Federal Reserve, collapsed — the second largest failure in U.S. banking history.  

Silicon Valley is not a real geographical valley, but the area in northern California that is home to many high-tech, low-tech, middle-tech companies ranging from start-ups to established companies, many financed by SVB.  

And many companies parked their money in SVB for such business basics as making payroll.  And then they couldn't because the bank had their money.  Warned, many of the companies had attempted to withdraw their funds.  Some succeeded; others didn't.

Because of its narrow niche — financing technology companies — SVB's problems are unique.  Other financial institutions are not quite as vulnerable.  Hopefully.

As I advised yesterday, stay tuned.  

More advice: Paraphrasing Margo Channing (Bette Davis) in the 1950 classic movie All about Eve, "fasten your money belt — it's going to be an extremely bumpy few years."

Image via Max Pixel.