It wasn't that they were paying higher interest rates than that, they miscalculated how much liquidity they'd need and how high-interest rates would go. It was a big-time error but not from risky investments.Quote:
If you are investing in government bonds and paying interest higher than they are paying you are going to have a bad time.
You made the claim I was responding to bub.Quote:
FJB and FDIC had lists of approved banks. Several US banks approached FDIC but were denied as they were not on the list. The source was reported to have said that the list was heavily influenced by wokeism.
I'm going to assume that folks mean the buyer (the UAE) was declined because they do not support wokism via DEI policies. If that is true, then that is dumb although there might be other reasons not to let the UAE buy this bank that are more strategic in nature.Four Seasons Landscaping said:
Then WTF is your point?
The only buyer anybody in the know has talked about was the UAE. You blamed it on wokeism.
Do you think not selling to the UAE is wokeism?
Here's a link.CDUB98 said:
How about you provide links to this rumor of a list of approved banks? If it's that simple, surely you can provide it.
jt2hunt said:
Steve Forbes is on there and said as of Friday and Thursday of last week they had multiple banks willing to take this bank over and buy them out. The Biden administration and the FDIC stepped in and said no because you're not on a white list of approve banks to be able to buy this bank meaning you're not woke enough or you're not social governance enough or you're not DEI etc. etc.
jt2hunt said:
Steve Forbes is on there and said as of Friday and Thursday of last week they had multiple banks willing to take this bank over and buy them out. The Biden administration and the FDIC stepped in and said no because you're not on a white list of approve banks to be able to buy this bank meaning you're not woke enough or you're not social governance enough or you're not DEI etc. etc.
Will the global marxist make a public announcement when they assume full control or are we just supposed to guess?jt2hunt said:
Steve Forbes is on there and said as of Friday and Thursday of last week they had multiple banks willing to take this bank over and buy them out. The Biden administration and the FDIC stepped in and said no because you're not on a white list of approve banks to be able to buy this bank meaning you're not woke enough or you're not social governance enough or you're not DEI etc. etc.
Dunno what to say. Multiple sources saying there was a whitelist, you had to be on it, and it was based on some internal woke measure.FincAg said:
PNC and RBC are in the "woke" category
Stat Monitor Repairman said:
Need a distraction from global economic collapse ... pepaw gon' hit us with that mothership baby!
Bam!
WARREN CALLS ON POWELL TO RECUSE HIMSELF FROM FED REVIEW OF SVB
— zerohedge (@zerohedge) March 14, 2023
You really have no clue what you're babbling about, fyi. The real cause of the present banking crisis is...deregulation pushed by Barney Frank and Bidenflation caused by...POTUS Poopy pants. And now we are bailing out billionaires/rich crypto investors for uninsured losses.Manhattan said:
It's exactly what they were doing, they were also investing in other businesses like any other bank.
Many of those businesses had VCs tell them to pull all their cash which was a partial contributor to the fail.
Quote:
The blame game over SVB's collapse is a diversion. The media have rounded up the usual suspects: Trump, greed, bad law, blah, blah, blah. When Captain Renault did that in Casablanca, he knew who the real culprits were. The media is not that bright.
James Hickman is. He is the founder of Sovereign Research. He looked at the numbers and he found the culprit.
Biden. He made government bonds worth less which has banks dropping like cockroaches in a Raid commercial.
Using the pen name Simon Black, Hickman wrote, "Silicon Valley Bank was no Lehman Brothers. Whereas Lehman bet almost all of its balance sheet on risky mortgage bonds, SVB actually had a surprisingly conservative balance sheet.
"According to the bank's annual financial statements from December 31 of last year, SVB had $173 billion in customer deposits, yet only $74 billion in loans."
So where did the money go?
Hickman said, "SVB failed because they parked the majority of their depositors' money ($119.9 billion) in U.S. government bonds.
"This is the really extraordinary part of this drama. U.S. government bonds are supposed to be the safest, most risk free asset in the world. But that's totally untrue, because even government bonds can lose value. And that's exactly what happened."
SVB lost money on government bonds by the billion and that brought the bank down. That is like water catching fire.
Hickman said the bank noted in December that it had $15 billion in unrealized losses on government bonds. On Friday, those losses were realized. You see, to cure inflation, the Federal Reserve must raise interest rates, which pushes the value of the existing bonds down.
Well that is just one bank and . . .
Hickman reported, "The FDIC estimates unrealized losses among U.S. banks at roughly $650 billion."
You can see why the Fed panicked on Sunday with its bailout that it refuses to admit is a bailout. They do not know what they are doing and have not for some time. America is headed toward a multi-trillion-dollar bailout of banks that will make Tim Geithner's $700 billion TARP look like a taco truck.
Silicon Valley Bank was the first bailout something akin to Ham the Chimp, who became America's first astronaut when NASA put him in suborbital flight on January 31, 1961 11 days into JFK's presidency. The banking bailouts will pass the moon by April and leave the solar system by the year's end.
Citizens are helpless as the kleptocratic presidency begins to wildly spend money we don't have. Millions, billions, what comes after trillions?
Every freaking banker in the world.
And why not? Uncle Sam is giving stuff away.
ABC reported, "Silicon Valley Bank UK purchased for 1 by HSBC with plan to protect deposits."
They bought it for a one-pound note? Where's my $2 bill autographed by President Ford's treasurer? I need it to buy Bank of America in June.
Axios reported, "When a bank fails, depositors are made whole by the FDIC insurance fund. The insurance only covers deposits up to $250,000, although there are plenty of workarounds that allow depositors to effectively buy much more FDIC insurance than that.
"In the cases of SVB and Signature Bank, FDIC insurance will now cover all depositors, regardless of size. The FDIC insurance fund which is funded by a levy on bank deposits [insurance premiums] stands at roughly $125 billion."
The bailouts are absolutely illegal. SVB paid premiums on only 3% of the money deposited there. Signature paid premiums on only 6%. The two banks could easily deplete all of the FDIC fund.
But SVB's depositors who will be paid despite not being insured include Mark Cuban and other Democrat fat-cat billionaires, so Biden will take care of them unlike East Palestine, Ohio. The administration keeps saying we must make depositors whole.
As for Signature Bank, seven years after Barney Frank co-wrote the Dodd-Frank Act, which put a few restrictions on bankers, Signature added him to its board of directors. He then lobbied to roll back Dodd-Frank.
The Wall Street Journal reported, "Mr. Frank, who has earned more than $2.4 million in compensation from Signature Bank since 2015, rejected the idea that the regulatory change abetted to Signature's collapse."
Frank told WSJ, "Nobody has shown me any evidence of systemic or other kinds of fraud that would have been prevented" had they not changed the rules in 2018. I agree. If any fraud were committed it was by the government that issued the bad bonds.
But Paleface Pocahontas is on the warpath. Elizabeth Warren wasted no time in getting the New York Times to publish, "Silicon Valley Bank Is Gone. We Know Who Is Responsible," even as the ink was drying on all those Benjamins the Federal Reserve printed to bail out the billion-dollar banks.
Who did she blame for the bailout?
Trump.
She wrote, "Greg Becker, the chief executive of Silicon Valley Bank, was one of the many high-powered executives who lobbied Congress to weaken the law. In 2018, the big banks won. With support from both parties, President Donald Trump signed a law to roll back critical parts of Dodd-Frank. Regulators, including the Federal Reserve chair Jerome Powell, then made a bad situation worse, letting financial institutions load up on risk."
We need Melania to pull a Will Smith on Warren for putting Donald Trump's name in her mouth. (Just joking, Secret Service.)
But Warren's anger at the banks is as phony as her claim to be an Indian because she does not oppose the bailout. She is willing to let the government give billions to depositors whom she admits include "billion-dollar companies, crypto investors and the very venture capital firms that triggered the bank run on SVB in the first place."
No, what bothers her are not the billions for billionaires but the million-dollar salaries of the CEOs and the bonuses earned by bank employees.
She wrote, "We should claw all of that back, along with bonuses for other executives at these banks. Where needed, Congress should empower regulators to recover pay and bonuses. Prosecutors and regulators should investigate whether any executives engaged in insider trading or broke other civil or criminal laws."
Insider trading!
That's reserved for Nancy Pelosi and other members of Congress, not the hoi polloi who elect and re-elect these bums.
Politico reported, "The rift between Frank and Warren is just a preview of what's to come as Democrats sort out positions on how to respond to the latest banking crisis, which led to a weekend bailout of depositors at Silicon Valley Bank and Signature. Some like Warren want Washington to restore the tougher regulations that were rolled back in 2018. Some Democrats, like Frank, say the 2018 law isn't the problem. A number of moderate Democrats still in Congress helped write the 2018 legislation, including those facing re-election in 2024."
The main Democrat talking point is that the bailout is not a bailout.
Christina Wilkie of CNBC toted that water in her piece, "Wall Street not taxpayers will pay for the SVB and Signature deposit relief plans."
Sure it will because everyone knows the stock market is a charity organization.
Wilkie quoted an unnamed Treasury official, who said, "The firms are not being bailed out . . . depositors are being protected."
We are protecting Mark Cuban because billionaires are people, too. Especially the ones who donate to Democrats and hate President Trump.
Bailing out SVB is not the end, rather it is the beginning.
Stat Monitor Repairman said:
Need a distraction from global economic collapse ... pepaw gon' hit us with that mothership baby!
Bam!
New Spirit Halloween locations coming soon! pic.twitter.com/Vtmf6bNKNB
— Carolina Sailing Patriot🏴🍊🇺🇸🏴☠️ (@Tarheelnation81) March 13, 2023
Quote:
it's that's she powerless in her job
Warren very much understands this stuff, but she has the political instinct (and persona) of a tic tac.fka ftc said:
Careful, Warren actually comes across in a manner inconsistent with her BSC syndrome.
Good Morning Everyone! Credit Suisse stock plunges to all-time low. Down 96.7% from all-time high. Credit spreads blowing up and Saudi National Bank says they won’t assist anymore.
— Genevieve Roch-Decter, CFA (@GRDecter) March 15, 2023
This bank is drowning fast. pic.twitter.com/bBAyJVPkKP
will25u said:
Has the banking industry weathered the storm, or is there more pain coming?Good Morning Everyone! Credit Suisse stock plunges to all-time low. Down 96.7% from all-time high. Credit spreads blowing up and Saudi National Bank says they won’t assist anymore.
— Genevieve Roch-Decter, CFA (@GRDecter) March 15, 2023
This bank is drowning fast. pic.twitter.com/bBAyJVPkKP
+1YouBet said:
All that aside SVB execs are dumbasses for investing in long term bonds during the most prolific money printing in human history. Interest rates were always going to have to rise as a result to offset inflation.
Again, it's as if everyone that should know how that works has forgotten how that works. The other possibility here is that those execs knew that was the outcome and just assumed the government would bail them out at the appropriate time. In which case, they were correct.
But I actually believe it's the former. The number of financial heavyweights who no longer understand or acknowledge how inflation works is staggering.
I would bet "Doctor" Jill has hiked the rate by now.fka ftc said:
Also, more and more coming out about Chinese who had deposits and the US government going to make them whole above the $250k limit.
Always, always look for the 10% for the Big Guy...
