Interesting news today. Here’s the WSJ Editorial Board’s take:
The Treasury and Federal Reserve stepped in late Sunday to contain the financial damage from Friday’s closure of Silicon Valley Bank, guaranteeing even uninsured deposits and offering loans to other banks so they don’t have to take losses on their fixed-income assets.
This is a de facto bailout of the banking system, even as regulators and Biden officials have been telling us that the economy is great and there was nothing to worry about. The unpleasant truth—which Washington will never admit—is that SVB’s failure is the bill coming due for years of monetary and regulatory mistakes.
Wall Street and Silicon Valley were in full panic over the weekend demanding that the Treasury and Fed intervene to save the day. It’s revealing to see who can keep a cool head in a crisis—and it wasn’t billionaire hedge-fund operator Bill Ackman or venture investor David Sacks, both frantic panic spreaders.
There are over 4,000 banks in the U.S. Some will fail from time to time.
Usually, though, they engineer a buyout before it comes to this. Not sure what happened here.
They forgot.
“Oops, sorry. Hey, let’s save the planet. By the way, what are your pronouns?”
Three Banks Failed this week:
– Silvergate, $SI
– Silicon Valley Bank, $SIVB
– Signature Bank, $SBNY
https://twitter.com/unusual_whales/status/1635144656110632960
“SVB executives made mistakes and they will pay for them”
Really?
I’ll bet they get bonuses
They already did and some unloaded SVB stocks in the last few weeks. Now the taxpayers are bailing them out. This game is rigged.
I’m betting they’ll get additional bonuses.
For helping deal with the mess, etc.
You know whose banking system is pretty much firewalled off from all this chaos?
Russia’s.
Geez, I wonder if they knew something about our banks?
Apparently, this as well as many other Banks have subscribed to the “Go woke; Go broke” mantra:
https://twitter.com/EleanorTerrett
Anybody remember what Freddie Mac and Fannie May were up to in the lead up to the sub-prime mortgage bust?
This guy does! https://twitter.com/AlderLaneEggs/status/1635108933592551424
Bawney Fwank in the middle of financial chaos again. Whodathunk?
The top is still spinning, but it’s starting to wobble. Got gold?
Good analysis here: https://scheerpost.com/2023/03/12/ellen-brown-the-looming-quadrillion-dollar-derivatives-tsunami/
Linda L – That is definitely one of the problems . I think the immediate problem is people is people don’t want to continue to let their banks use their deposits for next to nothing when a one year gic pays 5%. The investments they have a small spread on have had to be sold at losses to cover withdrawals. This bankruptcy has left businesses with large deposits unable to pay their bills if all these deposits over 250 thousand disappear. The government either bankrolls it or Monday morning would absolute carnage and by Monday evening there would likely be 4 or 5 more banks insolvent, Make no mistake , it really is a bandage on a gunshot wound. It would not be surprising to see the .5 hike dialed back to .25 or 0. They really don’t have much choice – either calm and try to gain confidence- or face Armageddon. I really believe you need to protect your financial interests as best you can . Monday will tell if it even works. I acknowledge I may be totally wrong .
You are right, but not for long. They will have to abandon the inflation fight, which will really catch fire, they (we, the west) are now completely boxed in.
I have a lot of puts on banks I bought a month ago, Monday should be interesting, although that means I have more of what exactly? T. G. I also have gold. Lead may be more valuable though.
Those 4 or 5 banks are already insolvent, but are hiding it the same was SVB was by using the exception to the mark to market rule.
The Simpsons already covered the Silicon Valley Bank collapse:
https://twitter.com/unusual_whales/status/1635129557186486272
ESG is not ‘sustainable.’