Joe Biden reassures banks and says he doesn’t see ‘explosion’ on the horizon

The president of United States, Joe Biden, sent this Friday, the 24th, a message to reassure the banking system and said that, although the situation will take time to calm down, it does not see an “explosion” on the horizon. “I think it will take some time for things to calm down, but I don’t see anything on the horizon that is ready to explode,” he said at a press conference in Ottawa with the Canadian Prime Minister. Justin Trudeau. Despite the reassuring message, Biden said he understood there was “some unease” and that his administration had done “a good job” to ensure that Americans could access their savings and that US banks were sufficiently funded.

Biden’s message is part of the government’s attempts to calm the markets, assuring that the American banking system is solid and that the authorities will take measures to guarantee savings in the face of the crisis triggered in recent weeks by the collapse of two American banks and the rescue of one. third. Panic also crossed the Atlantic and nearly bankrupted the Swiss bank Credit Suissewhich finally had to be taken over last weekend by its competitor UBS after the crisis of confidence that was sinking its market price. Biden said that “what is happening in Europe is not a direct consequence of what happened in the United States”.

The financial situation of the two bankrupt American banks, Silicon Valley Bank (SVB) and Signature Bank, was aggravated by the monetary policy of the Fed, the US central bank, which has been raising interest rates since March last year to combat inflation. The Fed decided to raise rates again this week, by 0.25%, to a range between 4.75% and 5%, although the bank’s president, Jerome Powell, did not rule out interrupting these hikes at its next meeting.

*With information from EFE