Welcome to our NCM BLOG page where we will address timely investment and financial planning topics...
SVB had a concentrated customer base. Too many of their deposits were from the venture capital/private equity/crypto space, which were all “hot money” areas. Here is the problem: Just as any investor, they should have diversified their customer base. This was a classic “bank run” as this close-knit community all headed for the doors quickly together.
Although conditions have not changed too much in January, many investors seem to be confused by the markets. Stocks and bonds are up nicely so far in 2023, but why? Aren’t we going into a recession? Isn’t inflation still too high?
As human beings, we need to be careful to avoid making emotional decisions regarding our finances. When faced with pain or concern, our human nature may make us feel like we have to DO something even though that action might not put us in a better position in the future.