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mathisen, and we have a big show lined up for you with all the angles as the fed stops to backstop the depositors at silicon valley bank and others we'll look at other regional banks, the impact on bond yields and mortgage rates, plus the ripple through crypto, biotech and even china. >> plus, the moral hazard question front and the center. if failing banks gets government backup does then courage the behavior that causes the problems in the first place? before that lets get a check on the markets which are impressively green despite the tremendous pressure we're seeing on regional banks as well. that's why the russel 2000s are down 1%. is up 123 points, the nasdaq half a percent and s&p 1%. >> let's take a look at all the action with dom chu. >> by no surprise the worst performing sector are the financials and banks are a big part of that story if you look at what's happening right now, we do have the

biggest laggard by far in the s&p 500 as first republic bank the shares are down 60% right now, but what you're seeing doesn't really tell the whole story of today's action because we've seen it stop and start and start and stop trading more times than i can count so the downside volatility is still there with what many consider to be in the wake of silicon valley bank and signature, the real epicenter for a lot of ripple effects for banking possible contagion. so first republic in the focus there. also other regional banks as tyler points out very much indiscriminate pick a look at pacwest, one the names we talked about being on the west coast, grow graphically business centric than what we've seen at first republic western alliance is down 46% and bank of hawaii is down 18% and even brokerage charles schwab earlier today had to issue its own statement on the record about its financial statement being better than what people are speculating it to be and by the way, not just regional banks and some of these brokerages

we're talking the money center banks feeling the pain right now. check out jpmorgan chase, the bout performer down 1%, bank of america down 1% and morgan stanley down 1.5% and wells fargo down close to 6% watch those banks, a big part of the story and let's send it over to christina partsinevelos. >> there's a lot of movement as seagen is surging by 16 points pfizer's ceo was on the airwaves seeing seagen has one of the greatest technologies to battle cancer another name making names is illumina after investor carl icahn is look for a proxy fight. icahn wants to nominate three people to the company's board and that's why the stock price is surging above 20% right now tracking for its best day since 2012 and still down about 20% or over 20% just over the past year or so. last but not least, you spoeg,

tyler, about the ripple effect sfsk bank will be removed from the s&p 500 after the close tomorrow, so that's tuesday and will be replaced by insu le t corporation, in an inlet medical device room and that's why insulet shares are up 5% on the news. >> thanks very much. we begin with the collapse of fally bank and what brought us to this very moment. sbv provide bank services and more to nearly half the country's capital-backed technology and life sciences firm the institution took their cash deposits and then invested them in longer-term debt securities, ie bonds, ie treasury bonds mostly, but that investment became overexposed amid federal rate hikes and rising interest rates. a lot of those bonds were longer term in nature losing value as rates rose a sign of turbulence that

depositors began pulling money from the bank leading to the largest bank failure since 2008. contagion fears as a result of this collapse were widespread in the federal reserve then stepped in to backstop the deposits which they did dramatically last night. steve liesman joins us now with more on those efforts. we have not seen anything like this, steve, in a long time. >> reporter: no, but tyler, that was an excellent explanation, and while the worst has opinion avoided, it appears both banking stocks and fixed income markets trading with continued uncertainty, continued concern over whether enough has been done to fix the financial system evercore isi writing banks will remain under pressure from less stable and more expensive deposits, attention will turn to other parts including insurers and bank interest rates swap counterparties carrying larger unrealized mark to market losses concern about the economic and

financial falliot of sbv's demise showing up in a massive fall in the massive outlook for rate hikes funds rate now trading around 4% folks, last week it traded as high at 570 so 170 basis points of expects easing has now come into the market. here's what's been done just to underscore what tyler said the guaranteed deposits at sfsk including the uninsured deposits creating an implicit but not an explicit guarantee for other uninsured depositors at banks. they should down signature created a new fund at the fed to finance-banked assets and eased lending rules at the fed's emergency discount window. so there are two oppose impacts on the economy lower rates, including lower mortgage rates and higher haved bank collateral. could be inflationary and help economic activity but a need for banks to pay higher interest rates and uncertainty in the system could dampen the economy.

tyler? >> you know, steve, one of the great lessons for investing is always to diversify, but this seems to be a bank whose corporate treasury did not diversify sufficiently in other words, they had too much of one kind of security and that would be long-dated treasuries at precisely the wrong time is that -- that is one of the things but not the only thing that is at the heart of this debacle. >> tyler, i hate to the correct you. in a somewhat amusing way because they also have long-baited mortgage-backed securities so a lot of that, too. they made two mistakes. >> but long-dated securities. >> well, long-dated securities i just wanted to thoadd that ita mortgage-backed and treasuries they didn't have a long depositing base and did not hedge the risk and they also had, you know, a large percent and of their deposits were

inuninsured. there were at least four things that went wrong. it's unclear to me why so many companies kept so much uninsured money at this account. the question is whether or noting this the fed's blessing and the fed not saying anything or the supervisors not saying anything made people feel confident in the bank. it was indeed the 16th largest everybody did banking there, as you said at the top of the segment there. if you were in the business you did your banking at silicon valley. >> steve liesman, thanks very much we appreciate it president biden this morning discussing the silicon valley bank situation kayla tausche joins us now from washington with those comments and the reaction across washington kayla? >> reporter: president biden spoke this morning with the goal of restoring confidence that main street depositors do not have to move their money to a big bank and to restore confidence on wall street that regional and smaller banks won't see similar deposit outflows that would challenge their

capital. here's the president in his own words. >> look, the bottom line is this americans can rest assured that our banking system is safe your deposits are safe let me also assure you we will not stop at this we'll do whatever is needed. >> despite that pledge and the $200 billion of capital already being deployed from the federal reserve, the government's federal deposit insurance fund and jpmorgan chase, the financial sector tox are still deteriorating, and there are fears that there's more to come. after all, the fed's usage of a crisis era systemic risk exception to take this rare access sends a message that systemic risk is or would have been possible for what happened. president biden took responsibility for this action that was taken nec director and treasury secretary throughout the weekend according to officials mr. biden spoke to california governor newsom as he tried to address the situation.

the question is how does washington respond if weakness spreads and in order to push for regulations. ultimately, tyler and kelly, it's still very early days on that front. >> is there a number someone has seen -- people would say it's potentially laughably small and it could unbehalfbly hard >> the big ticket numbers about what the government's firepower is at this moment. the governor's firepower is backstopping all deposits at sfsk bank. the federal reserve for its general changing facility that's going to be making collateralized high-quality chance to banks over the next year, that has about $25 billion, and then, of course, there's the additional $70 billion that the government and

jpmorgan chase are putting specifically into first republic, so already you have some -- some pretty high totals and, you know, it's unclear exactly how the government could do more and what they would see that total balance park figure being in the future. >> all right absolutely kayla, thank you kayla tausche. regional bank stocks led by first republic taking a beating despite the government's backstop of silicon valley bank, and the pain is not just being felt in the regionals. big banks also under pressure as fews of cracks are emerging in the financial system there you see three of the biggest three all down. >> for now on wall street let's bring in the banking report for are cnbc.com at cape kelly and also joining us is a cnbc key contributor. kate, how close did we come over the weekend if these steps had

not been taken to what you might describe as a panic or a run not just on a couple of regional banks but lots of them >> you know, it's really hard to note, tyler, as you know, when people are doing the literal monday morning quarterbacking having seen the dramatic steps that the government took over the weekend. it's hard to know. i mean, in some ways i think this is a very different situation than what we had in 2008 and i covered the -- the collapse of bear stearns very closely at the time and later wrote about it and it collapsed into nothingan's arms and 72 hours. the issues there were sis them and they were delivertives, the providers of the swaps and purchasers of the swap, the complex derivatives were systemwide in europe and beyond. here we egot a more isolated situation where you have the silicon valley bank nominally and literally that you guys have covered in the first hour have this ultimately nailed risk

management solution, especially in the rising interest rate environment. they were he have on deposits, largely uninsured deposits, a lot of major size. they had the longer term assets whose value fluctuated along with monetary policy, and there came a point where it was very expensive to try to access the prices through the market. there's an argument to say that this might have retain and people of were no doubt on edge and if the government hadn't taken such steps, some calling it a bazooka we might still in treacherous waters here today. >> there are regional banks of a certain skill, and then there are rooemg regional banks so calls that of a 34u67 bigger scale. we showed emn, pnc and a lot of

them are suffering today is that fair there's citizens, truist financial, m & t, citizens, those are big banks. >> some babies are being thrown out with the bath water. you have to ask yourself, we talked about the implicit back backstop for depositors at these other bakes. what about the equity holders? what happened to the shareholders of signature and silicon valley bank? they are in all likelihood wiped out so when you look at the action at first republic down 70% last i checked, you know, have you to ask yourself is there a concern that there's going to be value there, and so i think this is what we're dealing with these are the ramifications of what happened at silicon valley bank the investors, the foirnsdy talked to over the weekend they saw this and you can't unsee this risk and now what is the prudent thing for me at the very least diversify a couple of accounts it a they have and but the them in -- so,

therefore, there's still money flows going on and still wires this weekend and money is slowing. let me turn it back to you, kate the $250,000 limit is sainct it's been blown up by this, it would seem all depositors at sfsk and signature are going to be protected, and there's an implicit suggestion that all depositorseverywhere would be protected in the event of a bank not wanting to take on the risk. remember bear stearns and wamu and all of these banks that were, quote, rescued until they weren't and the one that wasn't was lehman talk to me about that and the possibility that, well, there may come a day where the fdic and the federal government says

no we're done protecting depositors who were foolish enough to keep more than $250,000 in the bank. >> right, tyler. this is a critical point, right. so they are absolutely -- there absolutely is an implicit message in there that all depositors will be protect it had, whether they are under $250,000 or more i've talked to wall street folks today who think at a minmonth fresh hold should be raised to $500,000 and kelly was just alluding to more than that the key is it hasn't been codified yet it wasn't done this weekend and may not be done in the near future that's important according to policy folks that ime i've talked to, talked to people on the hill and former executive branch officials, and they have said, look, we need to preserve some optionality here. you don't want to put together a massive program like that in a weekend. you're absolutely right, tyler in the absence that have there could be a bank let go because of the moral hazard, sort of the

precedent-setting effect that occurs when the government brings massive resources, taxpayer-funded resources to bear know know secretary yellen has made a key point of saying in this case they are not taxpayer resources. they are a bank subsidized fund. still, broad strokes, you know, if we're going to ensure every depositor with every potentially teetering bank, know, you could get into taxpayer bailouts here, and there's a real reticence towards that, so i think we don't know what the future holds. so far the early read that i'm getting from folks who have seen this movie before is that the government did a pretty good job in a pretty short period of time in taking appropriate actions here and that also, they may have, and we'll see, they have may have successfully ring-fenced the sbv related problems and signatures and the monetary policy course that the fed has chart and wants to ultimately continue on even if there's a temporary slowdown or cessation to its interest rate hikes. >> just a real quick comment citi is down 6%, wells fargo

down 5%. it's not as if the big banks are benefiting we're not seeing share price increases today and maybe we don't want to overlook too quickly the fact that the markets are a little bit skittish, even about some of the largest ones. >> yeah. you know, it certainly isn't contained to the smallest banks. i do -- my conversations with investors, with founders, they suspect or they hope that this is contained with the tech-focused banks we've seen them topple being on the east coast we think first reap sick for wealthy individuals and families west coast folks, eye opening. this was the second, you know, biggest market share in terms of tech founders and startups they have done a good job penetrating that market on the west coast and, you know, it's not surprising that they are down right now guys >> hugh, thank you very much kate kelly always great to see you, my friend. >> you, too, tyler, thank you. coming up, much more on the fallout of the collapse of the silicon valley bank.

next we'll discuss the moral hazard issue and then we'll head out to chicago. we'll be right back.

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impacts fdic with us is the chief strategist at interactive brokers it's good see you, steve what's the size of the pokes you're here that we could ultimately be talking about? yeah, it's like what's the need to even have different banks if you just raise the cap substantially? bill ackman, by the way, the treasurer of twitter, just tweeting again, you know, that we need to do something to raise that cap dramatically, but you can't put that together in the weekend so i'm curious how this is all going to play out. >> good afternoon, kelly, this is one of the problems that we have right now they are putting and aids on a trauma patient i understand why they did when showed do. otherwise. you can see the panics the problem is the fdic cap has been obliterated we don't know exactly what that is i'm not going to said exposure

is infinite because it's hard to imagine everyone having a run on the bake all the time and how does it get re-evaluated and passed on to banking customers to the form of what would have to be higher premiums because the premium mechanism accounts for a $250,000 cap, not an infinite company. >> everything everywhere all at once there's something in there, right? so what happens here i mean, does -- does there come a day where that deposit insurance limit goes up to $1 million, or does it -- does it fundamentally just disappear what's -- what's the likely outcome here >> this becomes a real question, and this -- this puts it all in the hands of politicians, and once -- once business crosses with politics, all bets are off. that becomes a whole other animal and that's really where -- the world that we're in right now. we're grasping around. it's logical to understand why we might want to the raise it to some level you mentioned a million.

that seems reasonable, but having none does introduce the idea of moral hazard, and moral hazard is when -- when you ensure risks for more than they are worth. you can't ensure your house for more than it's worth because you -- you might have an incentive if you're immoral to do something negative to your house, and so, you know, as someone -- as a former options trader, trade for 25 years, that's the one many market that doesn't require are and now we're talking about when the politicians get involve and everything goes haywire. what do you think the market is doing and the message it's sending today with this trading? >> the market today is all about return of capital, not return on capital when it involves banks if you've got your deposits at risk, you don't want to take any risks on those deposits so you're incentivized to just get them out that. part seems to be staunch, but if

you're a bond holder or a stockholder, you don't want to be bearing the risk because you just know that you don't know what is under the balance sheet, under the hood of all these various regional banks and so you -- you're in a mode to sort of shoot first and ask questions later. that's really the problem we're seeing today with the banking system in terms of the capital markets' reaction. >> in other words, do you think people are saying my bank may end up having to tap this facility and they may end circling back to those who tapped the facility and doing something, for instance, on the we canity or something like that >> it's very problem everybody -- which i guess is not always that easy, but nobody had the time or opportunity do that with every bank that they might have in their portfolio or a relationship with. that's why you have the get me out trade that you're seeing today. over time we do settle out and the market will do a good job of

separating the winners from the losers, but in the short term, you know, this was triage, and, unfortunately, that's the result we're seeing in the stocks is people just panicked to a certain extent. >> yeah. steve, appreciate it thanks so much good to have you today steve stosnick. still to come, interest rates on the move following the sbv fallout. we will head live to rick santelli in chicago, plus, we'll hear from actual sfab depositors that's next on "power lunch. ”. but seriously we need a reliable way to help keep everyone connected from wherever we go. well at at&t we'll help you find the right wireless plan for you. so, you can stay connected to all your drivers and stores on america's most reliable 5g network. that sounds just paw-fect. terrier-iffic i labra-dore you round of a-paws at&t 5g is fast, reliable and secure for your business. i'm so glad we did this.

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welcome back to "power lunch"ch investors pouring into bounds in the aftermath of the collapse of silicon valley bank. the two-year yield falling more than .03 of 1% rick selly in chicago talking to traders. rick, the simple question for me is this. why is that happening. is that because people have become convinced that the fed is not going to raise interest rates as aggressively as it had been, or is it because people want the safety of treasuries? >> reporter: i would say it's the latter, absolutely the latter there's credit risk, and we can all debate does the u.s. have

the supreme credit of course they do because they have the supreme printing press. yes, it's a credit event as a matter of fact, that's the scenario around the world, so tyler, let's look at the ten-year here, the ten-year in the uk and the ten-year in the eurozone all lower than they came into the year if you look at two years across the board, all lower now than when they came in all down on the year and if you look at the vix, vix looks like to will close at the highest level since the end of october. however, look at a 20-year chart it doesn't look that bad now let's go grab dave dave, all right, the big question everybody wants to know is we have a march 21st-22nd meeting, c pye and later on we have ppi is the fed going to rate or not? >> i think right now they are going to rates i think powell already said, you know, the market doesn't like to be shocked. >> if the market doesn't like to be shocked, i would like to see

their faces tomorrow hey, people works thinks the sped going to raise on 291st raise your hand. >> all right who thinks the fed will stand pat on 291st, raise your hands that really kind of amazed me, i have to say, gang, because my own feeling is i -- i think that they would be a bit crazy to raise at the next meeting, but it certainly looks like the traders are voting for crazy back to you. >> that was interesting. that was very, very telling. voice of the people. >> yu p. >> rick santelli, thank you, my friend. >> let's go live to california where we're reporting outside steal bank where depositors right now are trying to get their money. is that right? >> yes, they are, kelly. we've been here since early this morning since before banks open. silicon valley bank customers lined up to make sure they can get their money. there's 35 to 40 people out here

right now. there's representatives from the fdic, from the bank answering questions, reassuring customers that their money is safe we're seeing, of course, a lot more happier people here today than we saw on friday and from the folks that we've been talking, to the founders say that their number one concern over the weekend was making payroll this week so that announcement from the government is very good for them, and they want to wait and see what happens next we spoke to one guy at santa clara headquarters who is trying to move his money from silicon valley bank to another he was lined up from 2:00 a.m. this morning. >> we hope to have the money as close as it can be to somewhere where we feel a lot safer about it and it learn a bit more about exactly what's going on because things are moving very, very quickly. >> we feel there are some places where they have more certainty over the money and would like it to get there as soon as possible i think it's going to take a little while before things really, you know, get to a point

where everyone has clarity in what's going on. >> and what we're seeing out here is people going in three at a time into the bank, walking out, 20, 30 minutes later holding a cashier's check and, again, a lot of them look a lot more relieved today. >> all right thank you very much. appreciate that report. ahead on "power lunch," bitcoin also hitting a backstop. the crypto banking trifecta collapsing, but investors finding relief in the federal government stepping in so what comes next forryo? 'lbe right back and explore that the hiring process used to be the death of me. but with upwork... with upwork the hiring process is fast and flexible. behold... all that talent! ♪ this is how we work now ♪ get refunds.com powered by innovation refunds can help your business get a payroll tax refund,

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. welcome back to "power lunch," everybody. markets continuing to assess the damage from the collapse of the silicon valley bank. the bank put cash in long-dated u.s. treasuries and mortgage-backed securities as well and then when yields rose those treshsries declined in value big time causing a huge loss which started the ripple effect leading customers to pull their money out. now the fed backstopping customer deposits, but we are still seeing selling in many other banks. let's get to bob pins for the

broader market reaction. bob? >> reporter: tyler, $350 new lows at the new york stock exchange that's a lot that's about 2,500 stocks down here even though the s&p 500 is up big increase in new lows, and almost every one financial many of the major banks he hadding 52-week lows go right down the lee, key, fifth third. these stocks are down 30% to 45% in the last three or four days it just goes on and on u.s. bancorp, pnc, the region's top financial banks, banks below bank of america, citi group and m & t bank also at a new low what are the risks here? there seems to be three that are out there and a lot of people feel two of the three are not that real, lower net income, yes. they will have to pay more for deposits a new era of regulation, yes it's the deposit plight risk that has people a bit puzzled. most people agree the federal

government is essentially offering backstops to all of the banks at this point, and there's an implicit guarantee so a little bit of head-scratching going on about why exactly the regional banks are down and are subject to a lot of debate guys, back to you. >> thanks, bob at another corner of the market crypto is actually stabilizing after this intervention in the sbv crash and signature and, of course, what was it last week, silver gait? that's how quickly the events have happened. let's discuss. let's just discuss the fact that bitcoin is up today. the bulls are all saying, see, the demise of the banking system is finally making our case why is it rall schnegg. >> part of it has to do with big assumptions that have been made about how quick the fed was in to step in and backstop depositors and there's a thought process that, may, maybe the government will start providing liquidity again which is a massive departure from the line they have been pushing the last several months and there's a lot of hope coalescing around the idea when the fed meets later this month maybe they won't be

as quick to hike up the interest rates and so those macro events do very much ripple into the crypto market, but one headwind that people aren't talking about as much is the lack of liquidity and the overall crypto market will be a huge problem now that we've lost signature cignet and the silver gait payment network. >> that's true 24, 48 hours ago it looked like it could go the other direction when the usd c, the dollar coin was significantly below a buc. i don't know what the low tick was. there's a sense and we've analogize it had already with the money market mutual funds, oh, boy, are these about to experience another tether and cause widening pain so it's really amazing that apparently has now been unwound and what i saw today was trading back up near $1, so now what are people saying about the systemic issues that may not exist there? >> it was worrisome on saturday when circle said it had a $3.3 billion exposure because that when it banked with sbv, you saw

the erosion of confidence ripple through the stable coin market which is the backbone of crypto trading and it slipped as low at 87 cents on saturday and what it says when confidence was record, a lot of the investor money moved into tether wits biggest and most popular u.s. dollar beg stable coin which has faced a lot of speculation around its reserves and it certainly doesn't shore up confidence about what happens in a crisis meanwhile think back to last may when tera usd collapsed and set off a crypto explosion and sequence of currencies so the crypto area not so stable. >> and we may possibly repeat that on money. is it green across the board in crypto board >> as soon as we got that announcement last month, like the u.s. dollar peg stable coins returned to that 1-1 ratio.

>> and don't -- don't stop watching this area it feels like, you know, we've good little -- you know, glad's all fine for now thank you. appreciate it. >> all right thanks. oil prices falling today but a big recovery from this morning. pippa stevens joins us now with the latest. >> reporter: at one point wti was down nearly 6% so it's settling with the more modest 3% decline here some of the recovery no doubt thanks to bets the fed will pause the rate hikes nat gas it is going in the other direction jumping more than 6% we have seen the recount fall to a nine-month low and short conversation also likely at play here after that nearly 20% drop last week. now earlier today, the biden administration approved an $8 billion oil drilling project in alaska led by conoco phillips and known at willow in a hotly anticipated and controversial decision the department of the interior granted permits for three

drilling sites which was slimmed down from the initially requested five sites conoco's ceo called it the right decision for alaska and our nation, but environmentalists groups were quick to oppose the decision with the nrdc calling it a grievous mistake that green lights a carbon bomb. >> a carbon bomb, wow. a big pfizer buyout acquiring seagen for $43 billion. a lot of/on biotech and as we head to break we're sharing stories of women leaders in business and those of our cnbc teammates and contributors here is gwen jamir, nutrilic ious ceo and founder >> one thing people can learn from our journey it's perfectly okay to pivot. it doesn't matter where are you in your life oftentimes as women would are high-achieving, we oftentimes feel like we are pigeon-holed into whatever it is that we're known for, and i'm here to lit

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in the midst of this banking crisis, we've good big biotech deal joining us now to talk about it meg tirrell. hey, meg. >> hey, tyler. well, pfizer is buying seagem, a big-makerer of cancer drugs on the west coast for $43 billion, $229 per share this was a teal that had been telegraphed for at least a few weeks, but pfizer actually pulling through on it whereas merck had been rumored to be looking at seagen last year and ultimately didn't go through with the deal. we spoke with the pfizer ceo this morning about what made this company worth $43 billion to pfizerch here's what he said. >> seagen is having one of the greatest technologies to battle cancer it's called adc, these are

guided missiles that are attacking the cancer cells and can make a huge difference would i say that this is something like the mrna for vaccines i think we can make a very big difference with this technology in our hands. >> reporter: now this is just the late, but biggest of a spree of deals pfizer has been on really with all of the money that they brought in from their covid business and trying to fill a revenue hole from that business and patent expirations later in the decade. they bought global blood therapeutics, biohaven and arena over the last year or so they are trying to get to $25 billion in added revenue from deals by 2030. they say this gets them 80% of the way there. that still means they are looking for something that can add $5 million more in revenue by 2030. guys, the stocks of both companies rose today but on pfizer's end what i'm hearing from multiple people is that's more of a result of all of the unrest around sbv and pharma being seen as a defensive play

there, and if that were an upmarket pfizer's stock might be down the investor reaction on this deal ranges from anywhere from underwhelming to lukewarm at best saying seagen is a very good asset with the tail end pipeline but the questions are more around valuation being paid guys, back over to you. >> it does often come down to -- you know what they say better to get a great company at a great price than a great company at a good price. thanks search. we appreciate it today mig tirrell. more on what the sbv collapse means for the markets. dow hanging on to a 130-point gain and nasdaq up 1.25% as rates plunge we'll be right back.

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welcome back to "power lunch. markets are in the green nasdaq by more than 1% as some investors believe the svb shock is going to get the fed to back off on rate hikes. we shall see we shall ask sam stovall, chief investment strategist he says the fallout from svb's failure could keep the fed on a 25 basis point hiking path that's where you come down, not that the fed's hand has been stayed for now, but that they

will move in what many would consider a smaller increment than had been considered possible a week, 10 days ago >> hey, tyler. yeah i think that's likely to be the case, that we'll probably end up seeing the fed hike through the second quarter of this year, but then pause, and what they're not going to do is try to upset the apple cart any further by increasing the rate hike t march 21-22 meeting, keep a steady path so they'll probably have to change their mantra from higher for longer to high for long. >> so, how does the market digest ultimately what's been going on over this past weekend? we've seen a love carnage in regional bank stocks today, some of the big money center banks, new york banks as well have been stumbling a little bit there you see a lot of the regionals or super regionals

how does this play out in the market over the next four to six months >> well, don't leave out the brokers either so basically everybody in the financial space has had some challenges as retail investorsinvestors, institutional investors worry what's about to happen to these banks and what kind of impact it will have on the economy, et cetera we've seen pressure on the smaller cap stocks because regional banks might be reluctance to lend to lower quality smaller companies and could accomplish what the fed is attempting to do and slow the rate of growth for the economy as well as slow the rate of inflation, so i think over the next couple of months we're going to have to take a wait and see attitude our forecast was for a tale of two halves where the first half is challenging and highly

volatile but investors look across the valley some time in the second half toward a favorable 2024. >> meantime as kayla tausche points out the fed released an faq and release details on who taps this lending facility from two years from now, march 2025, and we have lloyd blankfein, former goldman ceo, first one the six months, thinks -- sees positives and says anxiety and volatility are high, but sharply lower rates, fed on hold, strong positives from the markets do you agree or think we're risking a rerun of 2008 here >> i don't think we're risking a rerun of 2008. a lot of people that are still in charge were there back then and they know what they needed to do to right the ship, so i would tend to say that if there are any mistakes they will be new ones not repeats of old ones i also think that history can offer some guidance because the fed usually starts to lower

interest rates about nine months after the last rate hike and while the s&p was up an average of 13%, financials led the way up an average of 22% so usually the groups that get beaten up on the way down, tend to be outperformers on the way back up. >> all right thank you very much. we appreciate it. >> my pleasure. >> the effects of the banking crisis in the u.s. rippling all 'le way to china's start-up maet wel have the details, next network, associated british ports can now precisely orchestrate nearly 600,000 vehicles passing through their uk port every year. don't just connect your business. (dock worker) right on time. (vo) make it even smarter. we call this enterprise intelligence.

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the ripple effect from the collapse of silicon valley bank is being felt across the country and around the world the bank was a lender to startups in china. eunice is live in beijing with that part of the story for us. >> hey, kelly. for the chinese tech sector silicon valley bank has played a role, early stage chinese tech startups looking to raise money in the u.s. would often park their funds at svb svb has friendlier requirements when it comes to opening accounts for example, using the -- being able to use a chinese mobile foreign market phone for verification and the company is seen as having a lot of flexibility when it comes to startupsas well as companies with vie or variable interest rate entities which are offshore entities that chinese companies often use to be able to list in the united states, and then the

bank also viewed as an entry way for chinese tech firms to go into the silicon valley ecosystem and have access to lcs, vcs and other startups. when the news about svb's failure first hit china there was panic throughout the weekend but the panic did subside once the u.s. regulators came in, though there is still certain about the longer term fallout that could happen. >> would they go to an american competitor or likely a chinese one? >> well, that's actually one of the interesting developments that because of the way the geopolitical situation is, there's actually a lot more money when it comes to vc funding in china or denominated in rnb than there has been in the past so that's helped to mitigate the effect a little bit. at the same time people are here worried about the fundraising

efforts an they've been through a lot in the start-up scene here for the past couple years because of the regulatory crackdowns as well, so that's a big concern for them. >> absolutely. eunice, thanks so much we know you'll be watching it. eunice in beijing for us. >> thanks to all of you for watching "power lunch" today. >> "closing bell" starts right now. all right. thanks so much welcome to "closing bell." i'm scott wapner live from post nine this is the make or break hour begins with the markets which are volatile, stocks and bonds reacting to the collapse of svb, the government rescue and what it means to your money your scorecard, 60 minutes in regulation, markets on edge all session long stocks guyrating quite a bit, yields nuplunging that's our talk of the tape today. a special guest to ask that question to. jeffrey