1. Ahhhh the money doesn't actually exist 2. FDIC agrees to infinity insurance 3. Can't do this 4. Okay well issue Central Bank Dollar Coin at parity with all those dollars 5. Control grid in place
reimbursement of depositors is not the same as bailing out a bank. Granted, it was unusual to reimburse SVB depositors for their full amounts, but it is basically the same as an insurance company reimbursing an insured homeowner if their house burns down.
One things these guys are way off-base on is that it's very common for banks to condition loans to companies based on maintaining certain balance levels at that bank. It wouldn't surprise me to learn that a bank in SVB's unique position between capital and tech start-ups could mandate that those companies to essentially only do banking with SVB.
Comment disappeared(?): Warning to everyone tho: if you have money at WF get out immediately. SVB did a mixed shelf offering shortly before collapsing and guess who else is doing a mixed shelf offering? Also coming out announcing they "have liquidity" which means they probably don't have liquidity since no bank should have to announce that
If you didn’t get out of Wells Fargo after the first few debacles, idk what to tell you. Get the fuck out now if you’re in cause your next deposit may not even show up in your account.
exactly what this @Kirk says. They've sucked for a long time, but if a bank says they're doing mixed shelf offerings and collapses, and another bank does MSO's, you can guess what the next step is. Ya think they're keeping fractional reserves above 0.0 if they don't have to, I got news for ya
What does Matt mean when he says there's no more avenues for making profit in this economy? Where's he get that idea from? Aren't companies all over the place seeing record breaking profits? I wanna understand his point better
They don't know what they are talking about. I'm all for these people losing their ass on their dumb shit apps but big corporations that actually do shit are making loads of money. The main problem with SVB is that they were providing things like 1% mortgage loans to their depositors who were above the FDIC limit. They did this so they could have enough capital to make the most insane investments and massive gambles. They also had alot of low interest rate bonds that helped them as well. When the market hits a down turn and the money soaks up people with loads of money will sometimes make a bank run. Of course there was no money in the bank when they went to take it out because their gambles didnt take off. I like Matt and chapo but they sometimes are really fucking stupid when it comes to finance and how to run an economy. They usually can't explain precisely what happened because they just aren't queued in on the subject. Sam Seder has been covering SVB way better.
What he means is even though we can look at a balance sheet and say an enterprise made money it’s not real, in the sense that you can say that profit or valuation translates to real value Let me explain. I own a railroad, I could spend money maintaining my equipment and staff, in investing in improving my railroad to function more efficiently. Or I could engage in stock buybacks that limit the shares on the market making the railroad more valuable, on paper anyway. Now of course if I do the buybacks the machine that makes the money (the railroad) will get worse, and will eventually break, maybe destroy a town or something. Long term the railroad will break so utterly that it will be useless and have zero actual value, but in my immediate term I’ll be able to cash myself out. That’s a simplification of everything that’s happening everywhere. It’s why everything you see around you is breaking down
It's less that there's not way to make a profit and more that there are fewer and fewer ways to meaningfully expand markets and increase long-term profitability, and the result is that firms looking to increase profits are doing things like stock buybacks and cutting their workforces
more like SILLY CON bank
Gottem
if anyone is wondering it looks like at least 90% of SVB depositors had money in their account above the 250k fdic insured limit
Naming your bank *Silicon valley* bank is already a red flag
Shyster Valley Bank was already taken
No, THIS is a red flag. 🚩
Might as well call it Jewish Bank
@@radricdavis8508no?
poor risk management by those who can afford to lose
A Honda odyssey is like 50 grand - so they're obviously struggling common folk...
The top 20% have almost no idea how the lower 80% lives, and they prove it every time they open their mouths.
Take the L tech bros fake futurists
Talking The Tru Tru 👍
Do you still have to buy the things for the birthday party after they plan it for you?
1. Ahhhh the money doesn't actually exist
2. FDIC agrees to infinity insurance
3. Can't do this
4. Okay well issue Central Bank Dollar Coin at parity with all those dollars
5. Control grid in place
I appreciate the Dire Straits tribute from Will at the end there
Will's tail end jokes are becoming Chapo folk lore for me to search out. He has this ability to put his humor at the end of a topic so well.
For the algorithm
reimbursement of depositors is not the same as bailing out a bank. Granted, it was unusual to reimburse SVB depositors for their full amounts, but it is basically the same as an insurance company reimbursing an insured homeowner if their house burns down.
He who has the gold makes the rules...
Unless the people who grow the food and fight the wars aren't interested in gold
One things these guys are way off-base on is that it's very common for banks to condition loans to companies based on maintaining certain balance levels at that bank. It wouldn't surprise me to learn that a bank in SVB's unique position between capital and tech start-ups could mandate that those companies to essentially only do banking with SVB.
Comment disappeared(?): Warning to everyone tho: if you have money at WF get out immediately. SVB did a mixed shelf offering shortly before collapsing and guess who else is doing a mixed shelf offering? Also coming out announcing they "have liquidity" which means they probably don't have liquidity since no bank should have to announce that
If you didn’t get out of Wells Fargo after the first few debacles, idk what to tell you. Get the fuck out now if you’re in cause your next deposit may not even show up in your account.
exactly what this @Kirk says.
They've sucked for a long time, but if a bank says they're doing mixed shelf offerings and collapses, and another bank does MSO's, you can guess what the next step is.
Ya think they're keeping fractional reserves above 0.0 if they don't have to, I got news for ya
What does Matt mean when he says there's no more avenues for making profit in this economy? Where's he get that idea from? Aren't companies all over the place seeing record breaking profits? I wanna understand his point better
"Too big to fail" corporations almost exclusively are making record profits, normal people, not so much.
They don't know what they are talking about. I'm all for these people losing their ass on their dumb shit apps but big corporations that actually do shit are making loads of money. The main problem with SVB is that they were providing things like 1% mortgage loans to their depositors who were above the FDIC limit. They did this so they could have enough capital to make the most insane investments and massive gambles. They also had alot of low interest rate bonds that helped them as well. When the market hits a down turn and the money soaks up people with loads of money will sometimes make a bank run. Of course there was no money in the bank when they went to take it out because their gambles didnt take off. I like Matt and chapo but they sometimes are really fucking stupid when it comes to finance and how to run an economy. They usually can't explain precisely what happened because they just aren't queued in on the subject. Sam Seder has been covering SVB way better.
What he means is even though we can look at a balance sheet and say an enterprise made money it’s not real, in the sense that you can say that profit or valuation translates to real value
Let me explain. I own a railroad, I could spend money maintaining my equipment and staff, in investing in improving my railroad to function more efficiently. Or I could engage in stock buybacks that limit the shares on the market making the railroad more valuable, on paper anyway.
Now of course if I do the buybacks the machine that makes the money (the railroad) will get worse, and will eventually break, maybe destroy a town or something.
Long term the railroad will break so utterly that it will be useless and have zero actual value, but in my immediate term I’ll be able to cash myself out.
That’s a simplification of everything that’s happening everywhere. It’s why everything you see around you is breaking down
there’s little left to make a buck on beyond arbitrage of financial instruments and running phone & email scams
It's less that there's not way to make a profit and more that there are fewer and fewer ways to meaningfully expand markets and increase long-term profitability, and the result is that firms looking to increase profits are doing things like stock buybacks and cutting their workforces