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The banking crisis didn’t dampen tank confidence. It was already in the toilet.

In the wake of the banking crisis earlier this month, financial planners and wealth advisors reassured clients with emails and phone calls that the turmoil would not spiral out of control, that their investments were safe.

“We’ve been posting on social media and making outbound calls to our clients telling them not to expect failures of some US banks,” John Yulin, CEO of Yulin & Company Wealth Management, told Yahoo Finance. ,

To attract nervous savers, many fintechs introduced increasingly inflated insurance on deposits above the traditional $250,000 guaranteed by the FDIC. And smaller banks inflated their income on their deposit accounts to keep customers happy.

The latest data suggests they were all trying to get ahead of an event they thought would spook Americans – which largely hasn’t happened.

This week, an index measuring Americans’ sentiment for the current economy dipped in March, interrupting a three-month streak of growth. But overall, consumer confidence increased during the month, according to the Conference Board survey conducted 10 days after the bank troubles began, due to improved expectations for the future.

Still, that doesn’t mean that Americans held their eyes as banking turmoil loomed. Nor does it mean that they feel generally upbeat about the economy. The index remains at a reading that often signals a recession is coming next year, a level the index has been at for 12 of the past 13 months.

An index measuring Americans’ sentiment for the current economy dipped in March. But overall, consumer confidence increased due to better expectations for the future, according to the survey conducted 10 days after the banking crisis began.

“I see that a large number [clients] “They’re afraid of their retirement planning, they’re afraid of what will happen to their jobs,” said Katherine Keane, enrolled agent and fellow at the National Tax Practice Institute. Everyone just seems worried. It’s very inconvenient how shall I put it.

Most Americans were not unaware of the troubles besetting regional banks this month.

Only 17% had not seen, read or heard about the collapse of Silicon Valley Bank (SVB), a March 22-23 study by the Harvard Center for American Political Studies found, with the remaining 83% of respondents reporting that they Exposed to banking drama to varying degrees.

Survey data shows that while many did not expect the events to affect them directly, 29 per cent thought there could be some impact on them personally and a third are concerned about frozen bank deposits .

“The phone calls coming in from customers this week were less concerned with the SVB-led banking crisis going viral and throwing the economy into a tailspin, and more concerned if there was any underlying upside to their cash and the investments of our independent custodians. There can be risks,” Yulin said.

FILE – Customers and bystanders line up outside a Silicon Valley Bank branch in Wellesley, Mass., Monday, March 13, 2023. The sudden crisis in the US banking industry is bound to result in some reduction in lending and credit and a recession in the economy. The pace of borrowing and spending. If it does, the crisis could actually aid the Federal Reserve in the elusive goal the Fed has been chasing for an entire year: very low inflation rates. (AP Photo/Steven Sene, File)

The recent developments also shook the confidence in the banking industry as a whole. Only 10% of Americans polled by The Associated Press-NORC Center for Public Affairs Research said they trust banks and other financial institutions, a sharp decline from 22% in 2020.

Marguerita Cheng, CEO of Blue Ocean Global Wealth, saw it firsthand with her mother.

“Yeah, I took the time to explain to my mom,” Cheng wrote to Yahoo Finance about the uproar. “I think the one that’s really shocking is Credit Suisse, because Swiss banks have a reputation for keeping assets safe.”

Nevertheless, Americans’ unhappiness with rising prices was overshadowing the banking crisis. According to a Harvard poll, more than 35% of adults named inflation as the biggest problem facing the country today, the issue receiving the highest percentage.

“It’s really focused more on the fact that inflation is where it is,” Akiva Ellis, a certified financial planner, said of the overall sentiment.

Data from the Conference Board survey this week also suggested that inflation is taking a toll on Americans.

Many people plan to cut back on discretionary spending over the next six months: 36.6% expect to spend less on gambling and lotteries; 34.1% expect to spend less on museums; And 33% expect to spend less on amusement parks. Nearly a third expect to spend less on movies (32.2%) and travel (31.9%).

It’s troubling investors that haven’t kept up with the market and their returns. [inflation] over the past year,” Ullin said. “They are anxiously awaiting the start of the next bull market.”

Kerry Hannon contributed to this report.

Rebecca is a reporter for Yahoo Finance and previously worked as an investment tax consultant. Certified Public Accountant (CPA),

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