Elizabeth Warren calls on FDIC to investigate Silicon Valley bank collapse

Elizabeth Warren calls on FDIC to investigate Silicon Valley bank collapse

Sen. Elizabeth Warren, D-Mass. There was an investigation into the collapse of the Silicon Valley Bank and Signature Bank on Sunday.

Warren called on the FDIC to investigate the leadership of both banks prior to their downfall earlier this month. Warren is one of many lawmakers on Capitol Hill who want more information about how the banks collapsed and why.

The bank's executives, who took unnecessary risks or failed to hedge against all foreseeable threats, must be held accountable for these failures. According to the Wall St. Journal, Warren wrote a Sunday letter to the FDIC regulators, saying that mismanagement was allowed to occur because of a series of failures by lawmakers and regulators.

Biden said that the bailout would not come at the expense of American taxpayers, but he said the funds would come from insurance payments from banks.

EJ Antoni, a research fellow in regional economics with The Heritage Foundation's Center for Data Analysis, says that is not the case.

The idea of bailing out SVB, Signature Bank and others without costing taxpayers doesn't pass the smell test, Antoni said last week. That costs the taxpayer by definition. Antoni told Fox Business that the idea that taxpayers aren't on the hook for the mitigation effort, which Biden is not a bailout, is false when you look at the mechanics of how the bailout is operating. Antoni explained that the FDIC doesn't have enough funds to cover these losses. If it did, the Federal ReserveFederal Reserve would not have to establish an emergency lending fund on Sunday night to backstop the operation. The Fed can simply create the money to cover the losses at these failed banks, which will cause inflation, or the FDIC can do what they did in the last financial crisis and get the money from the Treasury, which is a direct cost to taxpayers. The American people are either on the hook for the hidden tax of inflation or explicit taxes sent to the Treasury.