by Mia Taylor
Last updated: 4:33 PM ET, Wed March 15, 2023
The news has been dominated in recent days and weeks by headlines about a string of bank failures, which have rocked the start-up community.
Silicon Valley Bank (SVP) was the first to collapse last week, followed by Signature Bank. Both banks tanked after clients rushed to withdraw their funds. Federal regulators have since seized both banks.
Now it seems there may be ramifications from the bank failures for travelers. Well-known CBS travel expert Peter Greenberg has said travel prices may drop in the near future, amid the bank failures.
"People are worried. And when they're worried, they tend not to travel," Greenberg said, according to WINK News.
Greenberg elaborated, explaining that when people are worried, as they may be now, it translates to less spending.
"So you're seeing at least in the short-term reservations now, a big softening, and the airlines all the algorithms that the airlines used to project demand and set prices, they go out the window again," said Greenberg.
To be clear, airfares typically change throughout the day, every single day of the year. This includes when the economy experiences unexpected changes, as with the pandemic in past years, and now, perhaps amid the bank failures.
"When you have a disruptive situation like this, when it affects your money, or at least the perception that it affects your money, people tend to want to hold on to their money," Greenberg told the news outlet.
If prices do come down, it will be a much-needed relief in some ways from inflation. According to the Bureau of Labor Statistics' Consumer Price Index, airfares in the U.S. rose by 26 percent in January compared to the same month last year. The price increase outpaces the 6.4 percent year-over-year jump for the all-items index.
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