Why?
Because other banks are going to have to be on top of the same problem SVB faced and didn't deal with properly. So, because they will less likely be giving out loans in a more cautious manner than before so they too can stay solvent that this will prevent businesses from expanding too fast and prevent people who want to borrow money to buy homes and businesses. This will also cool never ending inflation cycles somewhat too.
I think to be realistic we have to compare the times we are in to the end of world War II. If we do that we can make more sense of what the world is going through.
Even though buildings were not blown up except in Ukraine by Russia we are in a cycle business wise a lot like 1945 to 1950 caused by Covid. Because the Covid deaths were so completely underestimated worldwide we are not looking at the problems in a realistic way like we were forced to after World war II by whole cities and nations devastated with the U.S. being the last big nation still standing who then loaned money to other nations around the world to get back on their feet. This was why America was in such better shape than the rest of the world from 1945 until the Viet Nam War and the Arab Oil embargo in the 1970s. In the 1950s and 1960s the average American had more buying power than before or since.
In fact, one could say that (at least in my lifetime) the Average American has never been so (buying power wise) so impoverished as he or she is now.
In the 1950s a 17 year old white man without a high school Diploma could buy two cars and a home and support 5 people quite easily just by becoming a carpenter or garbage man then.
But, this is not longer true. But, mentioning it will help you to understand just how relatively poor the average American is now. And this is only getting worse by the day caused by inflation to where people have to choose between buying food to eat and paying rent for a place to live.
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