24-03-2023 16:52
Ken Griffin: US capitalism is breaking down
Some analysts suppose that some sectors of the Russian economy can be a vivid example of capitalism. Ken Griffin, the founder of hedge fund Citadel, cleared up the situation with the modern economic reality. Notably, the US billionaire is extremely worried about the ongoing collapse of capitalism in the United States.
The bankruptcy of Silicon Valley Bank caused concerns about the rosy future of US capitalism. The decision of the US financial authorities to give back money to affected depositors caused a lot of rumors. Ken Griffin, the founder of hedge fund Citadel, was the first one to call the situation alarming. He supposes that “American capitalism is breaking down before our eyes”. “There’s been a loss of financial discipline with the government bailing out depositors in full,” Griffin is sure. He thinks that “the US government should not have intervened to protect all SVB depositors.” “It would have been a great lesson in moral hazard,” he said. “Losses to depositors would have been immaterial, and it would have driven home the point that risk management is essential,” the billionaire added.
In other words, the US economic system suggests support to both banks and depositors. However, according to the market rules, everyone should have learnt a lesson from the situation.
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
Published 24 March 2023
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