‘Net worth of median household is basically nothing,’ says Carl Icahn. ‘We have some major problems in our economy.’

The Fed’s rate hikes are intended to cool economic growth by raising borrowing costs and tamping down demand, but the ill effects of those interest-rate increases appear to be surfacing in pockets of the economy.

Banks have been on a wild ride since late last week.

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Blame it on the failure of a slate of banks, notably Silicon Valley Bank SIVB, -60.41% and Signature Bank SBNY, -22.87%. Those institutions have raised concerns about the ability of companies, and money-center financial institutions in particular, to operate effectively in this suddenly higher-rate regime.

Banks should be benefiting from a climate of rising rates because they borrow on a short-term basis and provide longer-term loans at higher rates, pocketing the rate differential.

Apparently, not all banks have been managing risks well and the celerity of the increase in interest rates, along with likely tactical missteps, may be part of the problem.

Shares of the SPDR S&P Regional Banking ETF KRE, +2.09%, which covers the regional banks segment of the broader S&P 500 SPX, +1.65%, tumbled 10% on Monday, after falling 4.4% on Friday following the seizure by California regulators and the Federal Deposit Insurance Corp. of SVB Financial Group, which operated Silicon Valley Bank.

Over the weekend, the Fed announced a new emergency loan program to bolster the capacity of the banking system and the government announced that all SVB depositors would get their money back.

Stock-market investors in the Dow Jones Industrial Average DJIA, +1.06% and S&P 500 have been tempest-tossed since the events took shape late last week, with industry participants still on the lookout for possible spillover to other areas of the market.

For his part, Icahn has been concerned about the economy after a historic stretch of easy money helped to underpin asset bubbles in everything from crypto BTCUSD, +0.54% to tech and meme stocks.

Based on his interview with CNBC, the legendary Icahn sees the business climate on a less-than-solid footing.

He said the median household net worth is “practically nothing.”

However, it isn’t clear exactly how accurate his figures are — though Americans have been contending with the challenges of rising prices and continue to do so for services as the impact of the COVID pandemic subsides.

The median net worth for American families, for example, stands at around $121,760, according to data from a survey conducted by the Federal Reserve’s survey of consumer finances in 2019, the latest available data. That was up nearly 18% from the previous survey in 2016.

That said, according to a report from Bankrate conducted last year, 56% of Americans would be unable to cover an unexpected $1,000 bill with savings.

Those are just some measures of America’s fiscal health but the overall picture has darkened for many as prices remain elevated and companies announce layoffs.

Meta Platforms Inc. META, +7.25% said it plans to lay off 10,000 more employees as it focuses on a “year of efficiency.” The Facebook parent had already announced plans to slash more than 11,000 jobs in an initial round of cuts back in November.

Icahn sees conditions getting worse before they get better and it may be worthwhile for investors to take heed.