Government races to reassure US that banking system is safe
NEW YORK (AP) — Depositors withdrew savings, and investors broadly sold off bank shares as the federal government raced to reassure Americans that the banking system is secure following two bank failures. President Joe Biden insisted Monday that the system is safe after the second- and third-largest bank failures in the nation’s history happened in the span of 48 hours. In response to the crisis, regulators guaranteed all deposits at the two banks. They also created a program that effectively thew a lifeline to other banks to shield them from a run on deposits.
After two historic US bank failures, here’s what comes next
WASHINGTON (AP) — Two large banks that cater to the tech industry have collapsed after a bank run, government agencies are taking emergency measures to backstop the financial system, and President Joe Biden is reassuring Americans that the money they have in banks is safe. It’s all eerily reminiscent of the financial meltdown that began with the bursting of the housing bubble 15 years ago. Yet the pace this time around seems even faster. Over the last three days, the US has seized two banks after a run on Silicon Valley Bank. The Associated Press addresses what the US is doing and whether it will be enough.
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Signature Bank seized to send banks a message, director says
A regulatory takeover of a New York-based bank was intended to send a message to banks to stay away from the cryptocurrency business. That's according to a former member of Congress who was on the bank's board. Former U.S. Rep. Barney Frank says Signature Bank had a high volume of withdrawals but had the situation stabilized by the time New York regulators stepped in on Sunday. They shut down the bank and give temporary control to an arm of the federal government. The bank was taken over just two days after California-based Silicon Valley Bank met the same fate. Both Frank and New York officials said that “contagion” from the Silicon Valley Bank was a factor.
Flood problems grow as new storm moves into California
WATSONVILLE, Calif. (AP) — Crews rushed to repair a levee break on a storm-swollen river in California’s central coast as yet another atmospheric river arrived with the potential to further inundate the state’s swamped farmland and agricultural communities. Officials say the length of the levee rupture on the Pajaro River grew to 400 feet Monday, complicating efforts to plug the breach. More than 8,500 people were evacuated when the levee failed late Friday. It flooded farmland and agricultural communities on the central coast, about 70 miles south of San Francisco. Monterey County officials also warn that the Salinas River could cause significant flooding of roadways and agricultural land, cutting off the Monterey Peninsula.
California court rules for Uber, Lyft in ride-hailing case
SACRAMENTO, Calif. (AP) — A California appeals court has ruled companies like Uber and Lyft do not have to treat their drivers as employees. The ruling means app-based ride hailing and delivery companies do not have to provide certain worker protections and benefits. The state Legislature passed a law in 2019 requiring these companies to treat their drivers as employees. Companies like Uber and Lyft spent $200 million in 2020 on a campaign to convince voters to exempt them from that law. Voters agreed. In 2021 a state judge ruled the companies were not exempt from the law. Monday, a state appeals court overturned that decision.
Asian shares extend losses as US banking worries persist
TOKYO (AP) — Asian shares have fallen in early trading as investors around the world watch to see what's next following the second- and third-largest bank failures in U.S. history. Benchmarks declined across the region and oil prices also fell. U.S. futures turned higher. In Asia, direct exposure to the risks from the U.S. failures appeared slim, at least so far. Still share prices for Japanese banks were sharply lower. MUFG fell 6.3%, Mizuho sank 5.8% and Sumitomo Mitsui Financial Group's shares dropped 6.2%. On Wall Street, bank issues fell but some stocks rose on hopes the Federal Reserve will take it easier on raising interest rates.
Biden's test: Can he show competence to avert banking chaos?
WASHINGTON (AP) — President Joe Biden is confronting a significant challenge as his administration grapples with the fallout from the second- and third-largest bank failures in history. He's doing so amid significant stakes for both the U.S. economy and his political future. Privately, Biden has been adamant that the government’s intervention would not be like that of 2008, when Congress authorized billions in taxpayer cash to rescue banks deemed too big to fail, a senior White House official says. But officials knew they had to act, given the economic risks and the potential impact on bank customers who did nothing wrong.
Russia: 60-day extension of wartime grain deal acceptable
GENEVA (AP) — A Russian delegation at talks with senior U.N. officials says Moscow is ready to accept an extension to a grain export deal that has helped bring down global food prices amid the war with Ukraine. But it said it would accept only a 60-day extension as the Kremlin holds out for changes to how the arrangement is working. The United Nations and Turkey brokered a deal between the two warring countries in July that allows Ukraine to ship food and fertilizer from three Black Sea ports. The 120-day agreement, which helped take some of the sting out of rising global food prices, was renewed last November. That extension expires on Saturday. The U.N. said it “notes” Russia's announcement.
Biden OKs Alaska oil project, draws ire of environmentalists
WASHINGTON (AP) — The Biden administration is approving a major oil-drilling project on Alaska’s petroleum-rich North Slope. The decision, announced Monday, is one of President Joe Biden’s most significant climate moves, and it brought quick condemnation from environmentalists who said it flies in the face of the Democratic president’s pledges. Climate activists say allowing oil company ConocoPhillips to move forward with the Willow drilling plan breaks Biden’s campaign promise to stop new oil drilling on public lands. ConocoPhillips says the project could produce up to 180,000 barrels of oil a day, a major advance for the nation.
Alaska's Willow oil project is controversial. Here's why.
JUNEAU, Alaska (AP) — Supporters say a major oil project President Joe Biden is OK'ing on Alaska’s petroleum-rich North Slope represents an economic lifeline for Indigenous communities while environmentalists say it runs counter to his climate goals. The decision on whether to approve ConocoPhillips Alaska’s Willow project in a federal oil reserve roughly the size of Indiana was revealed Monday. Houston-based ConocoPhillips says the project could produce up to 180,000 barrels of oil a day, about 1.5% of total U.S. oil production. There's widespread political support in Alaska for the project. Biden’s decision pits Alaska lawmakers against environmental groups and many Democrats in Congress.