I think this piece at National Review is useful in unpacking the causation more thoroughly, but in a nutshell, you likely know by now that Silicon Valley Bank was taken over by the FDIC on Friday. Essentially, upon hearing that Moody’s was about to downgrade their credit rating, SVB went on a mission to raise equity capital to solidify their financial position after word got out (from footnotes in a financial report, no less) of large mark-to-market losses in their bond portfolio). The word that they were trying to raise capital caused depositors to pull funds. And the word that depositors were trying to pull funds caused their efforts to raise capital to fail. The vicious cycle moved quickly, and by Friday morning, FDIC regulators determined that there were now fewer assets than there were liabilities (in this case, the liabilities are a reference to the uninsured deposits), and they took over the bank,
