The drama of this week's bank-stock market blindsided most, except for the corner of Wall Street that noticed a gradual increase in bearish interest in the $2.2 billion SPDR S&P Regional Banking ETF. The Fed's rising interest rates, a response to inflation, has caused major problems for two small banks on the West Coast. SVB Financial, a Silicon Valley-based bank, was forced to sell off $1.8 billion in assets at a loss due to an outflow of deposits. Similar withdrawals at Silvergate Capital caused them to do the same. The withdrawal of deposits came from startups and technology firms, many of which were struggling to succeed amid the rising interest rates.

The problem is that banks need to safely park their cash and have been investing in low return investments such as treasury bills during the pandemic, not expecting interest rates to suddenly rise. This leads to major financial losses if