Source: United States Senator Kevin Cramer (R-ND)
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WASHINGTON – U.S. Senator Kevin Cramer (R-ND), member of the Senate Banking Committee, joined “Eric Bolling The Balance” on Newsmax to discuss Silicon Valley Bank and the fiscal and monetary contributors to its collapse. Excerpts and full video are below.
On Next Actions Following Recent Bank Failures:
“We should resist making knee-jerk responses until we know more about what happened at each of these banks. What were the fundamentals? How much of it is related to the upside-down situation related to a fast spike in interest rates and deposits? How much of it is capitalization, how much of it is not?
“It certainly does seem that there were some people who were asleep at the switch, whether it’s management, the board, perhaps Fed regulators, because it does appear there were some warning signs – acknowledged warning signs that weren’t headed in time to salvage these situations, and so there’s a lot we have to learn before we certainly jump to some sort of systemic solution to what might be a fairly localized problem.“
On Overspending, Tightening Monetary Policy as Contributors:
“When we were already in what you have to consider a pretty hot economy coming out of the COVID pandemic, […] a new president comes into office and the first thing he does is, he wants to get in on the act, passes on a straight party line vote this $2 trillion American Rescue Plan, follows that up with a nearly trillion dollars more in the Green New Deal stuff. It was just pouring fuel on the fire.
“It all starts with a spike in inflation, which then led to the necessity of the Federal Reserve to do what they do, and that is raise interest rates in an effort to slow that down. But even while they were raising interest rates, the federal government was continuing to overspend, over-tax, overregulate, hurt the supply side of the economy. You really had forces working against each other. And then you have the fallout that we’re experiencing now.”