With SI and SIVB falling off, this is no surprise.
This is a really wild thought in a high inflation environment. Not that I disagree. Equities can lose dollar value on top of the dollar itself losing value. Some portion of it has to be going back to risk-off assets that were not worthwhile in a zero-rate environment.
People have been doing that for a year now. It's not new. It didn't start happening because of SI and SVB.
1. Crypto events such as collapse of an exchange
2. Fed interest rates
3. Nasdaq (more than S&P500 and Dow).
So it is interesting that it is causing such panic.
In fact both SI and SiVB are in trouble because they have long duration assets and short duration liabilities.
I would happily loan money to a startup to make payroll, if that loan was 80% of the value of deposits they had in the collapsing SiVB, as long as the loan was secured with those deposits - that way I can be pretty certain I'm getting repaid, even if the startup goes bankrupt in the meantime.
SiVB's deposits are their liabilities. Their MBS portfolio is their asset, which has been hammered by rising rates. The correct haircut on that is not 20%, it's more like 90%. The stock market is betting that equity holders of SiVB are going to get wiped out.