2nd US Bank failure!

Discussion in 'Markets & Economies' started by bretto, Mar 13, 2023.

  1. serial

    serial Well-Known Member Silver Stacker

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    This is true but shiney is also right,cowboys in the industry will see this as a green flag to continue with the poor practices that are toxic
     
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  2. florincollector54

    florincollector54 Active Member

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    I tend to agree with you, although it should be noted that SVB and NY Signature Bank were very much on the inner, supporting the "right social/political causes" and public promoting their ESG policies.
     
    Last edited: Mar 13, 2023
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  3. jultorsk

    jultorsk Well-Known Member Silver Stacker

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    Fed Rate Pivot Is Back in Play
    Markets are predicting a change in the course of interest rates now that there is trouble brewing in the banking sector.

    The deal appears to be as follows: As of the time of writing, there isn’t a buyer for the whole bank (sidenote: HSBC buys SVB's UK arm). Instead, the Federal Reserve, US Treasury and Federal Deposit Insurance Corporation announced in a joint statement that all depositors will have access to their money as of Monday, and that no taxpayers’ money will be used. The statement suggests that any ultimate costs will be borne by other banks through the levy on them for deposit insurance: There will be no protection for holders of bonds or equities in the banks, and the senior management has been fired.

    Meanwhile, the Fed will introduce a new acronym, the BTFP, which stands for Bank Term Funding Program, for which $25 billion is available. This will allow banks to borrow from the Fed using Treasury bonds as collateral and valuing them par. If the problem is solely one of liquidity rather than solvency, this should make a difference; banks are sitting on a lot of bonds whose value has tanked over the last year.

    This doesn’t matter so much if they can hold them to maturity, but becomes a very big problem if they have to sell them for a loss — in such a situation the possibility of a death spiral such as UK gilts suffered last autumn would arise. If the existence of the BTFP serves to calm the banks’ clients down, it doesn’t have to commit the money; if the pressure intensifies, it might have to come up with much more than $25 billion. The effect is to ease financial conditions a bit. If all goes to plan, however, the outcome will be to make bank depositors (not just SVB’s) bear the bulk of the cost. That will ultimately be bad for banks’ profits, and therefore their shareholders.

    https://www.bloomberg.com/opinion/a...runs-into-a-defi-wall?leadSource=uverify wall
     
  4. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    SVB had already tapped the San Fransisco Fed on the shoulder for 15 billion in 2022.
     
  5. Oddjob

    Oddjob Well-Known Member Silver Stacker

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    Behind the scenes at the US Fed.........

    [​IMG]
     
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  6. JohnnyBravo300

    JohnnyBravo300 Well-Known Member Silver Stacker

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    They are shoveling as fast as they can haha.

    At this point they may as well give up on the inflation fight and do what they can to save the banks and the markets. Its the only choice to keep the fakery going and they have a foot on each pedal now anyway.

    They can continue endless bailouts and rob the treasury of any possible future or chance of recovery before Brics makes an announcement. Might be the best play.

    Gains are privatized while losses are socialized.
     
  7. Roswell Crash Survivor

    Roswell Crash Survivor Well-Known Member Silver Stacker

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    30+ U.S banks hit with NYSE trading halts thus far, including Charles Schwab.
    First Republic, Western Bancorp and PacWest are getting blown the f##k out.
     
    Last edited: Mar 13, 2023
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  8. sammysilver

    sammysilver Well-Known Member Silver Stacker

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  9. 66rounds

    66rounds Well-Known Member Silver Stacker

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  10. leo25

    leo25 Well-Known Member Silver Stacker

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    Be nice if all jobs paid their employees large bonuses just for doing their job. The perks of having access to funny money. Wonder how all these snowflakes in tech are going to handle the real world.
     
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  11. bretto

    bretto Active Member

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    First Republic Bank shares plunge days after three other US banks collapse
    Customers and investors appear to have lost faith in another US bank, just days after three banks sensationally collapsed in a move that sent shockwaves around the world.

    Overnight, fears mounted for a regional bank based in San Francisco, First Republic Bank, with its shares tanking drastically.

    SVB, Silvergate, Signature banks all have been taken over by US govt and now today First Republic bank 70% market cap was wiped off and there are 10 other regional banks hemorrhaging. US govt has frozen the trading on these 10 regional banks which includes First Republic bank.
     
  12. Michael Kay

    Michael Kay Active Member

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    What's with the massive bold font? Are you blind like Mr Magoo or something?
     
  13. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    ^ probably a cut and paste.
     
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  14. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    And for those that like a dabble on the ponies there's an omen bet today in R1 Ballarat - Hedged. :p
     
  15. bretto

    bretto Active Member

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    Michael Kay.
    Sorry if it stressed you out, mate.
    It was copied n pasted!
    Was in a hurry but wanted to share the info! lol
     
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  16. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Apparently there's 1 bank for every 70 000 people in the US, in Australia there's 1 for every 260 000 people.
     
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  17. leo25

    leo25 Well-Known Member Silver Stacker

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    Joseph did a good talk about this topic. In short these banks didn't do their job and manage risk.

    He thinks they might change the $250K deposit insurance across all the bank to unlimited, but said it would be a bad idea as it will just increase bad behavior.

     
    Last edited: Mar 14, 2023
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  18. leo25

    leo25 Well-Known Member Silver Stacker

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    There are about 21 million people above the age of 14 (one would assume anything over 15 you would have a bank account) So 1 in 260,000 means there are about 80 banks in Australia. I didn't realise we have that many banks in OZ?
     
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  19. Darwin

    Darwin Well-Known Member Silver Stacker

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    If it includes online only and it's not indicating physical branches, that may be possible...
     
  20. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Crazy hey? I've never heard of some of them.

    https://www.thebsbnumbers.com/banks/
     

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