Tech investor and podcaster who ‘set the fire alarm’ at Silicon Valley Bank hits back at critics

Jason Calacanis, a well-known venture capitalist and host of the All-In-Tech podcast, caused a stir on Twitter over the weekend with a series of panicked tweets about the Silicon Valley Bank (SVB) collapse.

With nearly 700,000 followers on the social media platform, Calacanis expressed his apprehensions about the situation, warning his audience to “NOW ABSOLUTELY GAINED” and predicting it could “SPIRAL INTO CHAOS”.

After announcing over the weekend that the federal government had pledged to safeguard the assets of all depositors at the now-defunct bank, Calacanis took to Twitter again to brag about how he successfully “set off the fire alarm” and slammed his critics for ” ungrateful,” but not before continuing to fan the flames of panic all weekend.

Over the weekend, Calacanis appeared to tweet in all caps and was one of the loudest voices urging the Biden administration to throw a lifeline to the SVB before pushing President and Treasury Secretary Janet Yellen ‘MUST GO ON TV TOMORROW AND GUARANTEE ALL DEPOSITS UP TO $10 MILLION.’

Jason Calacanis, a well-known venture capitalist and host of a popular tech podcast, caused a stir on Twitter when he expressed his concerns about the collapse of the SVB

Calacanis posted a series of panicked tweets, all in block capitals

Some of the tweets that were predictions were beginning to border on hysteria

Calacanis painted a picture of panic if the government didn’t step in… which it did

Calacanis is known for being one of Silicon Valley’s most influential voices alongside his co-hosts of the All-In podcast, including self-proclaimed “populist” David Sacks.

The trio often touts its ties to industry giants like Elon Musk and German-American billionaire Peter Thiel.

But Calacanis and Sacks have been criticized for their role in spreading panic over the bank run on SVB and their enthusiastic support for the Biden administration’s intervention to bail out the bank.

Calacanis was also called out by other Twitter users, with one saying “your tweets aren’t helping” while another asked “why are you doing this?”.

Some tech journalists and pundits have described Calacanis and Sacks’ behavior as irresponsible and offensive, with one commenter likening them to “tech brothers” who were more interested in self-promotion than constructive engagement.

UC Davis professor Martin Kenney was quoted as saying that he “would keep [his] shut your mouth and count [his] bless that [he] was saved by the taxpayer.’

Following the government’s pledge to safeguard depositors’ assets, Calacanis took credit for sounding the alarm and then said his critics didn’t appreciate his warnings

People wait outside Silicon Valley Bank’s headquarters in Santa Clara, California, on Monday to withdraw money after the federal government intervened after the bank collapsed

Customers could wait outside SVB branches here in Santa Clara on Monday

The Biden administration assured taxpayers this weekend that such funds would not be used to bail out the bank.

The issues at the SVB had been in the works for months. When the Federal Reserve raised interest rates, it put pressure on many of the bank’s core clientele, including venture capital and technology companies, who began withdrawing their deposits.

SVB executives had made the decision to ban many more, compounding the bank’s problems.

“They were so greedy for profit,” venture capitalist Chamath Palihapitiya said on the All-In podcast. “At some point the risk people at the SVB simply made a very big miscalculation. They basically went and bought a 10-year risk to pay back money that could be withdrawn daily or weekly.’

After SVB sold its long-term investments, it turned out that the bank had suffered a huge loss of almost $2 billion. This revelation prompted widespread panic, with several influential members of the startup community advising their portfolio companies to divest their assets.

Throughout the weekend, Calacanis continued to spread concern through his tweets

Calacanis was called out by other Twitter users, with one saying, “Your tweets aren’t helping.”

Even after the government intervened, Calacanis continued to post how the situation was “getting out of control.”

After the government’s intervention, Calacanis sought compliments declaring himself to be someone who issued warnings and “sounded the fire alarm.”

According to The Wall Street Journal, the frenzy began Thursday morning on private Slack channels in Silicon Valley, but quickly spread to social media platforms as startup founders began withdrawing their funds.

A full-blown bank run quickly followed, with depositors requesting a whopping $42 billion from the bank in a single day.

“You made the right business decision: If the theater is on fire and you panic first, that’s the best business decision you can make,” UC Davis professor Martin Kenney told The Daily Beast. “The panic is catastrophic for society.”

“And that’s kind of what happened,” he added. “A few of them panicked and headed for the exits, some of them yelling fire after they were out the door.”

As customers left, nearly $10 billion of the bank’s market value was wiped out before the government took control of it.

Source: | This article originally belongs to Dailymail.co.uk