Off-Topic Stock Market & Crypto Discussion

[SpikeUM]

Well that doesn’t make one feel too good. Are we days to weeks or months away from the 1930s?

BTW, those statistics again show you why Jamie Dimon is the best by far, and the rest of the bank management teams are average at best.

 

[JD08]

I posted this on the crime thread, but it seems appropriate here. Especially when people ask why the regulators didn't catch it. The short answer is because they were just doing enough to not get fired figuring nothing really bad will happen because someone else will catch it before it does.

From the crime thread:
I recently was involved in a discussion about the lack of leadership in hospitals and that spilled into the wider world. Basically, the one director referred to it as inertia management. Underqualified people are doing the bare minimum to make sure that whatever they're responsible for keeps moving forward. There's a pervasive belief that the system will just keep going and the one or two little things they add that might negatively impact productivity won't have a major impact on the organization as a whole.

 

[SpikeUM]

Wall Street Braces for the Next Silicon Valley Bank

Shares of regional banks tumbled amid concerns that Silicon Valley Bank’s collapse is only the beginning.

www.wsj.com

 

[SpikeUM]

I posted this on the crime thread, but it seems appropriate here. Especially when people ask why the regulators didn't catch it. The short answer is because they were just doing enough to not get fired figuring nothing really bad will happen because someone else will catch it before it does.

From the crime thread:
I recently was involved in a discussion about the lack of leadership in hospitals and that spilled into the wider world. Basically, the one director referred to it as inertia management. Underqualified people are doing the bare minimum to make sure that whatever they're responsible for keeps moving forward. There's a pervasive belief that the system will just keep going and the one or two little things they add that might negatively impact productivity won't have a major impact on the organization as a whole.

Big argument now among UHNW as to how much ESG played a role in this. SVB probably had a sky high ESG score.......

 

[SpikeUM]

Well that doesn’t make one feel too good. Are we days to weeks or months away from the 1930s?

I have been thinking about the ZH chart......what it doesnt show is duration. One could argue that SVB's risk management was incompetent bordering on negligent. My hope would be that the banks in the chart had say 2-3 year duration, so the market values would steadily accrete back to par. So from the chart, I would be especially worried about First Republic.

 

[90scane]

I have been thinking about the ZH chart......what it doesnt show is duration. One could argue that SVB's risk management was incompetent bordering on negligent. My hope would be that the banks in the chart had say 2-3 year duration, so the market values would steadily accrete back to par. So from the chart, I would be especially worried about First Republic.

Agree. Most banks can handle an economic down turn for 2-4years but anything beyond 2 years starts knocking out more and more to the point it could take out a lot more. If they can hold rates high for 2 years, I have a funny feeling we see a digital currency hit Main Street by then.

 

[Fluffhead]

@SpikeUM you see this?

Silicon Valley Bank exec was Lehman Brothers CFO prior to 2008 collapse

Prior to the Lehman Brothers collapse, Joseph Gentile was its CFO until 2007 when he left and became Silicon Valley Bank's Chief Administrative Officer.

finance.yahoo.com

 

[SpikeUM]

@SpikeUM you see this?

Silicon Valley Bank exec was Lehman Brothers CFO prior to 2008 collapse

Prior to the Lehman Brothers collapse, Joseph Gentile was its CFO until 2007 when he left and became Silicon Valley Bank's Chief Administrative Officer.

finance.yahoo.com

No, and WOW.

 

[Fluffhead]

No, and WOW.

Imagine that being on your resume and you still land in that kind of role.

 

[TheEye]

This is what I am referring to, why would anyone in their right mind have cash over $250K at First Republic and similar institutions?

Total deposits at First Republic were $176.4 billion, or 90% of its total liabilities, as of Dec. 31. About 35% of its deposits were noninterest-bearing. And $119.5 billion, or 68%, of its deposits were uninsured, meaning they exceeded Federal Deposit Insurance Corp. limits.

I wouldn’t have over $250k at BofA let alone a smaller institution. Never exceed $250k in an account. Open a new one for FDIC protection.

 

[90scane]

I wouldn’t have over $250k at BofA let alone a smaller institution. Never exceed $250k in an account. Open a new one for FDIC protection.

Open a new one at a different bank.
SIPC covers $500k in brokerage accounts but only $250k of cash. Thus, open a new one at a different bank.

 

[CFLCane]

I sure am glad we had leadership who, in the wake of 2008, put measures in place to ensure we'd never have a bank fail again.

Narratives are fun.

Trump signs the biggest rollback of bank rules since the financial crisis

The measure designed to ease rules on all but the largest U.S. banks passed both chambers of Congress with bipartisan support.

www.cnbc.com

 

[NC_Canes_11]

... Except it isn't an investment. It is fundamentally different, and has different protections and expectations. The ONLY reason SVB failed is literally because it had a panicked bank run. And once the bank run starts it has a snowballing effect. And that snowball can happen at other banks that are not arbitrarily deemed too big to fail. You're right deposits >$250k aren't 100% insured though. What you're ignoring is that SVB have the assets to cover the deposits - or at least >90% at worst. What people WANT is for the government to fund the deposits immediately or to let someone else step in and acquire the bank, because selling off all the assets could take months. All those customer deposits (even the uninsured ones) have priority over anything else. And there is a good chance one of those things will end up happening, but the communication has been very poor, which just makes more panic set in. And the worst case scenario is that panic spreads to people and businesses at other banks not federally deemed too big to fail, and they also experience a bank run.

Then you factor in that this IS literally the fault of how quickly the fed is raising rates (historically fast), and you have a very good reason people are ****ed and want some protection here. Again, nobody is wanting a bail out.

It’s not fundamentally different. You’re taking a risk with every penny that’s not insured. If this was any other local or regional bank in bum**** nowhere, they would laugh at the suggestion that depositors should be made whole.

 

[PanteraCanes]

Narratives are fun.

Trump signs the biggest rollback of bank rules since the financial crisis

The measure designed to ease rules on all but the largest U.S. banks passed both chambers of Congress with bipartisan support.

www.cnbc.com

What does a bipartisan ease of regulation for small banks have to do with the 9 the largest bank and regulators possibly ignoring or not investigating?

 

[JD08]

Narratives are fun.

Trump signs the biggest rollback of bank rules since the financial crisis

The measure designed to ease rules on all but the largest U.S. banks passed both chambers of Congress with bipartisan support.

www.cnbc.com

Who had full control of both houses of Congress and the presidency from 2021-2022?

You can play that pure partisan bull**** somewhere else. It doesn't fly with me.

 

[CFLCane]

What does a bipartisan ease of regulation for small banks have to do with the 9 the largest bank and regulators possibly ignoring or not investigating?

The Silicon Valley Bank Collapse And The Polycrisis

The collapse of Silicon Valley Bank (SVBVB) is the first sizeable victim of the deep financial fault line created since 2008. It is the second-largest bank default in U.S. history. The failure reminds us subtlety of the hidden and unpriced strands of the poly-crisis.

www.forbes.com

CEO Becker submitted a written statement that the applicable threshold of $50 billion in assets, before more stringent (liquidity and solvency) provisions kick in, was too low. The then-set threshold was moved up to $250 billion. All along, SVB operatedly cunningly underneath that threshold.

• Increasing the asset threshold for “systemically important financial institutions” or, “SIFIs,” from $50 billion to $250 billion.
• Immediately exempting bank holding companies with less than $100 billion in assets from enhanced prudential standards imposed on SIFIs under Section 165 of the Dodd-Frank Act (including but not limited to resolution planning and enhanced liquidity and risk management requirements).
• Exempting in 18 months bank holding companies with between $100 billion and $250 billion in assets from the enhanced prudential standards.
• Limiting stress testing conducted by the Federal Reserve to banks and bank holding companies with $100 billion or more in assets.

 

[CFLCane]

Who had full control of both houses of Congress and the presidency from 2021-2022?

You can play that pure partisan bull**** somewhere else. It doesn't fly with me.

It was signed in 18 bud.

 

[JD08]

It was signed in 18 bud.

So why wasn't it fixed in 21 or 22? Are you suggesting the current administration is incompetent?

Like I said FOH with partisan bull****.

It's been 15 years and 3 administration's since too big to fail. Solve the problem instead of sitting on your hands and deflecting blame.

 

[CFLCane]

So why wasn't it fixed in 21 or 22? Are you suggesting the current administration is incompetent?

Like I said FOH with partisan bull****.

It's been 15 years and 3 administration's since too big to fail. Solve the problem instead of sitting on your hands and deflecting blame.

I don't know why your panties are so twisted you're the one who tried to place blame on the 2008 admin. I merely showed you who loosened the regs. Who's the one being partisan?

 

[90scane]

I don't know why your panties are so twisted you're the one who tried to place blame on the 2008 admin. I merely showed you who loosened the regs. Who's the one being partisan?

I didn’t read his comment as partisan. He said in wake of 2008 which includes every leader since 2008.