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Started By
Message
Silicon Valley Bank: Customers withdrew $42 billion by the end of Thursday
Posted on 3/11/23 at 7:13 am
Posted on 3/11/23 at 7:13 am
Here’s how the second-biggest bank collapse in U.S. history happened in just 48 hours
Click the Video Image To: Watch the Video Clip
Can some finance, economic advisors please comment on whether this can happen?
This post was edited on 3/11/23 at 7:19 am
Posted on 3/11/23 at 7:20 am to cajunangelle
How’d you embed the Twitter link into the picture? I haven’t seen anyone able to do that on TD
This post was edited on 3/11/23 at 7:21 am
Posted on 3/11/23 at 7:22 am to cajunangelle
John Carney and Larry Kudlow discuss
quote:
"One of the problems [for SVB] was when money was so freely available to all these start-ups, they didn’t borrow a lot,” Carney told Kudlow. “So, they had a ton of deposits coming in and not a lot of opportunity to make loans out to people. I mean, yeah, you can lend money so people can buy a yacht or a fancy mortgage on some tech start-up billionaire’s fancy mansion, but they really had way too much money. So, they invested it in bonds. Bank of America I think has 25 percent of its assets in bonds, but this bank had over 50 percent of its assets in bonds.”
Kudlow noted that when the yield curve inverted, these bonds incurred a negative return.
“They’re losing money,” Carney agreed. “And at the same time, all these start-ups who are depositing so much money there are now withdrawing it because they don’t have access to free money anymore. So, they’re withdrawing it just to pay their bills. So, you’re having the deposits go down. They have to sell into a market where they are actually producing real losses, not just mark to market losses.”
“That is what sparked the panic basically,” he continued. “Earlier this week, [SVB] announced something like a $2 billion loss on their assets. And people said, ‘I better get my money out quickly.’”
quote:
All of this has been exacerbated by the Federal Reserves’ rate-hiking fight against inflation, which has signaled the end of the cheap lending low interest rate monetary policy that fostered Silicon Valley start-ups, Carney explained.
“I think we’re going to see a lot of the California-based financial institutions get into trouble because they were so dependent on this very cheap money ecosystem that was feeding start-up culture and is no longer there,” he said.
“What happens to the start-up culture now that there’s no cheap money or there’s no cheap, cheap money?” Kudlow asked. “[Are] they’re going to have trouble getting loans?”
“Absolutely,” Carney said. “They’ll have trouble getting loans and have trouble raising money because if you can get five percent on a treasury bond, why are you trying to get 10 percent on a very risky start-up? You’re not going to do that. You might as well just double down on leverage and get a treasury. So, I think that they’re going to have a lot of trouble being able to continue to raise money. And we’re going to see a lot of the start-ups start to tilt over.”
Kudlow asked Carney about the risk that this bank failure will spread beyond SVB.
“I think there’s a high risk that it spreads,” he said. “People are right now looking at every other bank, not the big banks—the JP Morgans, Citigroups, Wells Fargos, they’ll be fine.”
“The banking system is extremely well capitalized,” he added. “And so, I don’t think we’re on the verge of a financial crisis. But I do think we’ll probably have a couple more bank failures ahead of us.”
Posted on 3/11/23 at 7:26 am to Upperdecker
It's a lot of work.
First, you have to screenshoot the image, then you have to host it, then you have to copy the link, then you have to past the hosted image link in the description to the twitter video image link.
If you really get fancy you can use an image editor to add the play arrow.
Posted on 3/11/23 at 7:28 am to BengalOnTheBay
INB4 the cwills pipe in and say that Cally offers so much in exports to the rest of the USA.
Understood. But they suck as a State and got ruined by dem politics.
So...
This
Should happen, before this...
Understood. But they suck as a State and got ruined by dem politics.
So...
This
Should happen, before this...
Posted on 3/11/23 at 7:31 am to TrueTiger
It really isn't any more work than doing a screen shot. But using the MarkUp features on the right when you are creating a post: -----> of link, img, helps a lot-- or I wouldn't bother.
Posted on 3/11/23 at 7:33 am to cajunangelle
Also heard that the Bank high ups sold their stock about a month before the collapse, CA. Expected.
Gaetz may seem like a yahoo sometime, but he's a very smart person. I can see where he and MTG would be friends.
Gaetz may seem like a yahoo sometime, but he's a very smart person. I can see where he and MTG would be friends.
Posted on 3/11/23 at 7:35 am to RCDfan1950
quote:Remember I thought she was doing 3somes with Kev and fat Frank Luntz?
Gaetz may seem like a yahoo sometime, but he's a very smart person. I can see where he and MTG would be friends.
Kev was said to be one of the many that slept in his office because he wasn't rich. So Frank let him move in.
Does Kev sleep in the Speakers Office now?
This post was edited on 3/11/23 at 7:39 am
Posted on 3/11/23 at 7:49 am to TrueTiger
quote:Zelenskyy says, hold muh beer. bishes. I get that just in tips from Turtle visits.
$42 billion
Posted on 3/11/23 at 7:50 am to cajunangelle
Maybe SVB was investing in Ukraine?
That would be quite the ESG play.
Posted on 3/11/23 at 7:53 am to cajunangelle
quote:
3somes with Kev and fat Frank Luntz?
Posted on 3/11/23 at 8:22 am to TrueTiger
quote:
First, you have to screenshoot the image, then you have to host it, then you have to copy the link, then you have to past the hosted image link in the description to the twitter video image link.
Can you translate into Arkansan English for me? Thanks.
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