AS I watch the impending global economic collapse sparked by a California tech outfit non-ironically named ‘Silicon Valley Bank’ resume its spread of a deathly virus throughout such salubrious financial institutions as the Swiss banking giant Credit Suisse, I can’t help but wonder what, if anything, can stop the bleeding.
Whilst Credit Suisse is flogged for a mere 3billion Swiss francs (a bargain when you consider its whopping $574billion valuation at the end of last year and almost a trillion dollars at the close of 2020), we can only sit on the sidelines contemplating the absurdity of our age, when the worth of a global financial institution employing more than 50,000 people can be wiped out by half a trillion dollars in a couple of years.
The bail-out of Silicon Valley Bank, which must be critical to propping up the shrivelled up head of Credit Suisse, has been dubbed a ‘moral hazard on steroids’ by Irwin Stelzer of the Sunday Times. The US Government’s injection of $650billion to plug the tech funder’s liquidity hole will need to be covered by printed money, of course, and this actually translates into future terms as $2trillion (according to JP Morgan). In the end we will all pay for it, not just taxpayers across the Atlantic.
From my estimations, the downward spiral of Credit Suisse would be the equivalent of buying a new Prada bag for £2,000 and finding out three months later that its real worth is a mere £100, and later that some other sod had been foolish enough to pay £4,000 for it.
As if the picture could not be uglier, the bail-out money will go to a sea of Starbucks-queueing, hoodie-wearing, self-entitled nerdlets, who are even now preparing their development teams to build the next app, bolstered by algorithms tailored to take ever more of your hard-earned cash. Start-ups in the tech world are all built on promise, potential, and the phrase I like to borrow from a famous song, money for nothing, with your clicks for free. If Silicon Valley Bank and the likes of Credit Suisse were allowed to fail, there would be no more safety net for the rich kids, the ones who went to top schools and simply, cannot be allowed to fail.
Monetising clicks, likes and page visits is exactly what built these monsters in the first place, and perpetuates the shifting sands they sit on. We have, it seems, been hoodwinked, on the fake beachfront scenes by scam artists one after another – whether it’s the MP you elected in the hopes of ‘Getting Brexit Done’ or the sleazy home alarm salesman who assured you their system was directly linked to the police station.
As an example of skulduggery, take a look at the event touted in 2017 called ‘Fyre Festival’ which was exposed as a pack of lies. The Fyre Festival was to be held on an exclusive Bahamian island and was promoted by a raft of celebrities and influencers as the place to be. But ticket purchasers were defrauded of thousands of dollars each after being sold the dream of a luxury experience over Instagram and Facebook. They paid serious money to swan around quaffing champagne with supermodels and ended up sleeping in hurricane disaster tents on soaked mattresses until the authorities locked them up in the island’s airport overnight with no food or water.
The whistleblower who busted the operation succeeded in doing so with a photo of a Welsh rarebit. In a now infamous tweet, Trevor de Haas posted a picture of his dinner on the first night of the festival, consisting of two pieces of cheese on toast, which almost instantly went viral. Such is the power of social media in the hands of the people.
Don’t be like the duped attendees of that faux festival who got distracted by the rosé wine and tequila shots at the pre-party before they were led to their makeshift disaster tents with wet mattresses.
If you are feeling a sick sense of déjà vu from past experience, know that you are not alone. Someone, somewhere inevitably will bust it all open, with something as plain and simple as a Welsh rarebit.