- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
Any of you angry that you are bailing out SVB?
Posted on 3/12/23 at 10:06 pm
Posted on 3/12/23 at 10:06 pm
Because your bank will be charged special fees to make all SBV depositors whole….regardless If they are FDIC insured. Your bank will pass this cost on to you.
But don’t call it a bail out.
But don’t call it a bail out.
17
Posted on 3/12/23 at 10:07 pm to member12
Of course but we don't control anything. Our vote means nothing. Get used to it.
Posted on 3/12/23 at 10:09 pm to DaTruth7
Their risky, stupid decisions has no downside. We all cover it.
Posted on 3/12/23 at 10:09 pm to member12
I’m not angry because I expected it.
The elites will always win at the expense of the middle class.
This country’s government is a joke.
The elites will always win at the expense of the middle class.
This country’s government is a joke.
Posted on 3/12/23 at 10:12 pm to member12
quote:
Any of you angry that you are bailing out SVB?
Yep!
Posted on 3/12/23 at 10:12 pm to member12
It's not a 100% bailout per se.
Their "money" was tied up in mostly treasury bonds and other assets (like mortgages). It's my understanding that the money tied up in treasuries were put under a designation of "hold until maturity". Form Investopedia:
That amortization ate SVB's lunch.
Pros:
Cons:
LINK
Bottom line:
the depositors are being made whole by the existing assets on SVB's books that includes the treasuries and other loans. They will sell the treasuries and sell the mortgages to get the cash needed to make the depositors whole.
There will likely be a loss and IDK who will make up that loss. IDK who the buyer is of SVB's assets either. Probably the Federal Reserve.
It's not a total bailout. SVB had assets on the books, they were just illiquid. I would estimate that if there is any bailout the most exposure the tax payer has is about 5%. The tax payer should not have any exposure but this is Washington DC we are talking about.
Their "money" was tied up in mostly treasury bonds and other assets (like mortgages). It's my understanding that the money tied up in treasuries were put under a designation of "hold until maturity". Form Investopedia:
quote:
HTM securities are typically reported as a noncurrent asset; they have an amortized cost on a company's financial statements. Amortization is an accounting practice that adjusts the cost of the asset incrementally throughout its life. Earned interest income appears on the company's income statement, but changes in the market price of the investment do not change on the firm's accounting statements.
That amortization ate SVB's lunch.
Pros:
quote:
HTM investments allow for future planning with the assurance of their principal return on maturity.
Considered “safe” investments, with little to no risk.
Interest rate of earnings is locked in and will not change.
Cons:
quote:
The fixed return is pre-determined, so there's no benefiting from a favorable change in market conditions.
The risk of default, while slight, still must be considered.
Held-to-maturity securities are not short term investments but meant to be held to term.
LINK
Bottom line:
the depositors are being made whole by the existing assets on SVB's books that includes the treasuries and other loans. They will sell the treasuries and sell the mortgages to get the cash needed to make the depositors whole.
There will likely be a loss and IDK who will make up that loss. IDK who the buyer is of SVB's assets either. Probably the Federal Reserve.
It's not a total bailout. SVB had assets on the books, they were just illiquid. I would estimate that if there is any bailout the most exposure the tax payer has is about 5%. The tax payer should not have any exposure but this is Washington DC we are talking about.
Posted on 3/12/23 at 10:13 pm to member12
What are the chances this perpetuates more failures?
It’s only going to boost inflation. Which is going to require higher interest rates.
Which could precipitate more bank failures.
More bailouts. Rinse, repeat. Vicious runaway cycle.
It’s only going to boost inflation. Which is going to require higher interest rates.
Which could precipitate more bank failures.
More bailouts. Rinse, repeat. Vicious runaway cycle.
This post was edited on 3/12/23 at 10:15 pm
Posted on 3/12/23 at 10:16 pm to BobBoucher
quote:
What are the chances this perpetuates more failures?
Signature Bank has collapsed too. Big accounts spent Friday afternoon and Saturday morning GTFO of Signature and transferring their money to one of the big banks, WF, Chase, BoA.
Others to follow:
FRC
ZION
KEY
TFC
Posted on 3/12/23 at 10:16 pm to member12
Why didn't the people at Enron get this special treatment?
Posted on 3/12/23 at 10:19 pm to TrueTiger
quote:
Why didn't the people at Enron get this special treatment?
Enron CEO did not sit on the San Francisco Federal Reserve board.
Posted on 3/12/23 at 10:27 pm to GumboPot
quote:
Enron CEO did not sit on the San Francisco Federal Reserve board.
Kenny boy was pretty tight with the Bushes.
Posted on 3/12/23 at 10:29 pm to member12
I'm too busy prepping for the Great Depression I've been warning yall about.
Posted on 3/12/23 at 10:32 pm to GumboPot
quote:
the depositors are being made whole by the existing assets on SVB's books that includes the treasuries and other loans.
Exactly right. Anyone calling this a bailout has a misunderstanding about the meaning of that word. The company is being liquidated and returned to the depositors.
Posted on 3/12/23 at 11:04 pm to GumboPot
quote:
It's not a 100% bailout per se.
Government is rewarding bad risk management practices.
Executive and Board comp for the last 5 years should be clawed back. The whole gang banned from banking and the financial industry permanently.
There has to be a penalty for bad judgement to keep this from happening again and again. This is especially true in a fiat currency economy.. once that confidence is gone, it’s gone.
This is nothing more than savings and loans 2.0. Mismatch of balance sheet by “smart people.”
Posted on 3/13/23 at 12:33 am to goofball
quote:The depositors are getting their money back. The owners and investors of the bank are getting wiped out.
Their risky, stupid decisions has no downside.
Or do you consider putting your money in a heavily regulate, federally chartered bank a “risky, stupid decision”?
Posted on 3/13/23 at 12:36 am to jonnyanony
quote:
Exactly right. Anyone calling this a bailout has a misunderstanding about the meaning of that word. The company is being liquidated and returned to the depositors.
The liquidated value of the company is adequate to make all depositors whole?
Posted on 3/13/23 at 12:38 am to David_DJS
quote:Pretty much. Had there not been a run, this would have been fine and virtually no one would have even heard of this bank.
The liquidated value of the company is adequate to make all depositors whole?
This post was edited on 3/13/23 at 12:38 am
Posted on 3/13/23 at 1:26 am to Taxing Authority
quote:
Had there not been a run, this would have been fine and virtually no one would have even heard of this bank.
Had the frog had wings it would not have bumped its arse.
Posted on 3/13/23 at 5:11 am to member12
I hate everything about Joe Biden, Big Tech and the Uniparty. This is a perfect metaphor.
frick Silicon Valley.
frick Banks.
frick California.
And most especially- frick Joe Biden
frick Silicon Valley.
frick Banks.
frick California.
And most especially- frick Joe Biden
Posted on 3/13/23 at 5:26 am to GumboPot
quote:Right.
It's not a total bailout. SVB had assets on the books, they were just illiquid. I would estimate that if there is any bailout the most exposure the tax payer has is about 5%. The tax payer should not have any exposure but this is Washington DC we are talking about.
I'm as cynical regarding this administration as anyone. But to be fair, the choice was to let IPO assets productively mature and go to market as the FDIC is doing, or to pull the rug out, bankrupt those startups and increase the cost of the collapse ~ 10-fold.
Page 1 of 3
Popular
Back to top
Follow TigerDroppings for LSU Football News