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Silicon Valley Bank's failure was caused by a run on the bank. The bank's management sold $21 billion of bonds at a $1.8 billion loss, which led to the bank looking like an underperformer relative to its peers. Moody’s was considering downgrading its rating. The bank's management decided to raise new equity from General Atlantic and sell a convertible bond to the public. This move surprised the market and led to the bank's smart client base directing their portfolio clients to withdraw their deposits en masse, leading to a loss of confidence in the bank. The bank invested its deposits in low-interest rate bonds, which it held on its books on a long-term "hold-to-maturity" basis. The fallout from the bank's collapse is only beginning to be felt, and it may make it hard for venture capital firms to fund current and new investments.
Minimum wage laws set a price floor on the wages that employers can pay their employees. While the intention behind these laws is to help low-wage workers by requiring employers to pay them a higher wage, there are several arguments against the use of minimum wage as a means to address income inequality and poverty.
The Great Leap Forward was a campaign launched by the Chinese Communist Party in 1958 with the aim of rapidly transforming China's economy from an agrarian one to a socialist society through rapid industrialization and collectivization. It was led by the Chinese leader Mao Zedong and was based on the idea that China could industrialize and surpass the economic development of Western countries in a short period of time through the mass mobilization of its population.
