The financial sector in the USA is currently in a state of disarray on account of the collapse of Silicon Valley Bank and Silvergate Bank. These banks are considered two of the top banking and financial enterprises in the country, making their demise a major catastrophic event for the US economy.
Both these banks went through bankruptcy on account of the issues concerning lack of liquidity. The phenomenon has also made a visible impression on the cryptocurrency market.
On account of the collapse of these two banking giants and confirmation of more quantitative tightening from the Federal Reserve, many financial experts predict further uncertainty. Two such financial analysts and investors are Robert Kiyosaki and Peter Schiff.
Kiyosaki has recently issued a prediction that a 3rd banking enterprise might soon follow the same fate as Silvergate and SVB. He further put more emphasis on the probable price appreciation taking place in the precious metal market.
Robert Kiyosaki has Compared the Current Banking Crisis with Lehman Brothers in 2008
Commenting on the current matter, Kiyosaki mentioned in his latest tweets that the fall of SVB and Silvergate is to be related to the insolvency of Lehman Brothers in 2008.
It is important to mention for reference that Lehman Brothers was a financial services firm that underwent bankruptcy during the financial crisis of 2008 on account of a massive backlog of mortgage-backed securities or MBS based on subprime loans. Kiyosaki advised his followers to purchase gold and silver and stay away from ETFs.
He further noted that as soon as the third banking enterprise goes down, the prices of precious metals will soar. He reminded me that he predicted the fall of Lehman Brothers before the official news of the incident was aired on CNBC.
Before his current projections, Kiyosaki has also talked about a greater market decline that can realize in the form of several bank runs and a greater economic collapse. His predictions are issued under the pretext of Credit Suisse bank, which is recently gaining traction on account of its crypto-friendly policies.
Reflecting on the matter of Credit Suisse real estate investor named Graham Stephan has suggested that it persists in a critical state. He explained that the situation for Credit Suisse might worsen on account of the biggest price hike on its credit default swaps or CDS.
CDS are contracts that represent the purchase of insurance coverage by Credit Suisse against any possible default positions. The cost of these CDSs, as per Stephen, has reached the highest level since 2008, and it is still increasing in 2023.
Meanwhile, Peter Schiff, who is a vocal advocate of gold and an economist, claims that the US banking system is undergoing a tough time. He opines that the fear of increasing in the market can lead to bank runs that may lead to bigger financial crises.
He further warned that the next banking crisis might be greater than the fall of the 2008 financial tumble. For context, it is worth noting that SVB was the 16th largest commercial lender in the USA. Crypto entities such as Circle and Ripple Labs are also reported to have stakes in insolvent banks.
