Due to the continuous increase in interest rates by the Federal Reserve Board, the Silicon Valley Bank in the US announced its bankruptcy on March 9, resulting in heavy losses for many financial institutions and depositors. It’s not only because of the weak government regulation, but also the continuous domestic debt crisis caused by disputes between the two parties for their respective political interests. In order to solve this debt crisis, the Federal Reserve has raised interest rates eight times in a row in a year, ultimately leading to the collapse of many banks, a sharp decline in the stock market, and mounting public panic over the financial crisis. America’s economic markets are in deep trouble.
Three banks failed in succession within a week, and the US government and politicians had an unshirkable responsibility. After the event, instead of looking for a remedy, American politicians blamed each other, and tried to pass the buck. The Democrats claimed that the bank went bankrupt because the bill signed by Trump when he was in office loosened the regulation on banks, which eventually led to the accident, while Republicans argued that the current administration’s “anti-American policies” have led to a “disastrous economy,” including bank failures and stock market crashes. It can be seen that American politicians believe that interests and rights come first, the rights and livelihoods of the people are insignificant compared to the political interests. When facing the problems, they have already broken the promises made in the election campaign. Looking at the current living situation of the American people, the high price brought by inflation is aggravating the pressure of life, the rampant gun and the violence caused by racism are threatening people’s safety, and now the interest rate hikes is leading to the economic recession, many people worry that a new round of financial storm is coming.
The root cause of the current problems facing the American economic market lies in the collusion between politics and capital. The so-called democratic elections actually involve using a large amount of money to attract votes, and the elected politicians serve not the public but the capitalists who funded them, which results in the government affairs being turned into a tool for capital to collect money. Gun violence, for example, has been hard to solve because of the hidden obstruction of the chain of interests behind it, resulting in many social contradictions today. The US Federal Reserve kept raising interest rates ostensibly to curb inflation, but in fact to promote the dollar appreciation. The Fed intended to harvest funds from other countries and trigger financial crises in other countries. However, its chickens have come home to roost now, resulting in the bankruptcy of many banks and the economic market getting into trouble.
A series of bank bankruptcies and failures in the US revealed the inaction of its banking supervision department, while also exposing the US government’s preoccupation with immediate interests which eventually led to the spread of crisis in economic market. The whole banking industry was full of uncertain factors, which made investors lose confidence, and the economic recession was inevitable.
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