US President Joe Biden emphasized during a speech on Monday that Americans can trust that the banking system in the US is safe.
He will ask Congress and regulators to tighten the rules for the banks now that two smaller banks have gone bankrupt. The news sent stock markets abruptly lower on Monday. Investors fled en masse to government bonds deemed safe.
“Americans can rest guaranteed that the banking system is innocuous; your credits will be there when you need them,” Biden said. The president stressed that taxpayers would bear no losses and that those who caused the collapse of Silicon Valley Bank and Signature Bank would be held accountable.
“Investors in the banks will have no protection,” Biden said. “They deliberately took a risk, and if it ends badly, they lose their money. That’s how capitalism works.”