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Warren Buffett Talks with Biden Officials on Banking Crisis ahead of Fed Meet

Warren Buffett has long been taking grand steps in aiding the banks at times of crisis by implementing his cult investment status

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Hrishita Chatterjee
Hrishita Chatterjee
Covering culture and trending topics

UNITED STATES: Warren Buffett, the US business magnate, has been talking with senior officials of Joe Biden’s administration about the increasing degree of the banking crisis in the US. Berkshire Hathaway’s CEO could be part of the game to counter the crisis with Silicon Valley Bank’s crash, along with Signature Bank and Silvergate Capital Corp. 

Warren Buffett has long been taking grand steps in aiding the banks at times of crisis by implementing his cult investment status and financial weight to initiate hope for the banks that go through constant pressure.

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A capital injection was won by Bank of America Corp. and initiated by Buffett in 2011 following his decreasing stock price due to subprime mortgage losses. A $5 billion lifeline was also implemented for Goldman Sachs Group Inc. at the time of the 2008 financial pressure to aid the bank in lifting its status brought forward by the running down of Lehman Brothers Holdings Inc. 

The Federal Reserve has come up with many solutions for banks to borrow from it during the crisis, and at the same time, US regulators have come up with important measures to not put customers in distress, especially after the breaking of Silicon Valley Bank and Signature Bank this month. 

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Despite the measures, the actual worry has been in line with the wide banking risks that remain and have augmented uncertainties about whether the Fed will be able to sustain extremely high rate hikes. 

Before the shutting down of the Silicon Valley Bank, the policymakers at the Fed had augmented rates by almost 50 basis points following a chain of data that brought to spotlight the strength of the economy at the beginning of the year. The March 21–22 Fed meeting should make matters clear in terms of the volatility in the financial market. 

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Also Read: SVB’s Collapse Could Force Central Banks to Stop Interest Rate Hikes

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