From the editor...
The Fed raises interest rates until something breaks, says an old Wall Street adage. In the past few days dearer money has been the underlying cause of a nasty breakage in the banking sector. Bank failures are fairly common: there have been 564 in the US since 2001, but last week saw America’s second-biggest after Washington Mutual in 2008 when Silicon Valley Bank (SVB) collapsed (see page 16) with $209bn of overall assets and $175bn of deposits. That prompted a panic at Signature Bank, a key institution for the cryptocurrency sector, which rapidly become the third-largest failure. Herds of nerds Given that group-think is so prevalent in the technology sector, as MoneyWeek witnessed first-hand in the dotcom bubble (and chronicled in our “dotcom disaster of the week” column once it…