Those companies deposited the funds at SVB, which in turn made what must have seemed a conservative investment choice at that time: It plowed the cash into long-term U.S. government bonds and mortgage-backed securities. The problem was that in January 2022, once the Fed finally acknowledged that its easy-monetary policies had stoked sustained inflation, it started aggressively hiking rates. This tanked the bond market and lumped massive losses on SVB, which had made the fatal error of not hedging its interest rate risk.