Jimbo Posted March 12, 2023 Report Share Posted March 12, 2023 THE REALLY REALLY BIG QUESTION Why didnt the FHLB provide the exit liquidity to keep SVB afloat???? It did for Silvergate (well for a while) and Sigature. Someone somewhere made a decision. And it was the wrong one. Link to comment Share on other sites More sharing options...
fxfox Posted March 12, 2023 Report Share Posted March 12, 2023 Link to comment Share on other sites More sharing options...
Jimbo Posted March 12, 2023 Report Share Posted March 12, 2023 THE OTHER BIG QUESTION Who is on the other side of the interest rate swaps with the banks providing the insurance against rate rises???? Whoever they are are bleeding big time. Great short candidates if publicly traded. An ETF idea????? Need a catchy name for marketing purposes. "The Swamped ETF" Link to comment Share on other sites More sharing options...
sandy beach Posted March 12, 2023 Report Share Posted March 12, 2023 Link to comment Share on other sites More sharing options...
Jimi Posted March 12, 2023 Report Share Posted March 12, 2023 19 hours ago, Jimi said: Because, FERCRISSAKES, cash management is the EASIEST form of risk to manage. Link to comment Share on other sites More sharing options...
sandy beach Posted March 12, 2023 Report Share Posted March 12, 2023 19 minutes ago, Jimi said: Absolutely correct! I knew about this option when I started my own business in my apartment as a college student at Berkeley. If I knew this - they surely knew this too. I remember Bob Brinker used talk about this all the time on AM radio. They were not merely depositors. They signed a contract to swap the risk of being uninsured for the benefit of getting the whole VC networking / financing bundle. That's on them. No way should the middle class bail out these high risk start-ups. Link to comment Share on other sites More sharing options...
Jimi Posted March 12, 2023 Report Share Posted March 12, 2023 5 minutes ago, sandy beach said: They signed a contract to swapped the risk of being uninsured for the benefit of getting the whole VC networking / financing bundle. That's on them. No way should the middle class bail out these high risk start-ups. Totally. I would like to know, for example, what perks the CFO of Roku personally enjoyed from the bank the past 3 years as a "Thank you" for being its loyal commercial customer. Link to comment Share on other sites More sharing options...
sandy beach Posted March 12, 2023 Report Share Posted March 12, 2023 6 minutes ago, Jimi said: Totally. I would like to know, for example, what perks the CFO of Roku personally enjoyed from the bank the past 3 years as a "Thank you" for being its loyal commercial customer. I'm guessing more than a few frequent flying points! ROTFLOL "Would you like hookers and blow with that checking account sir?" And the jobs argument - give me a break - these are high risk start-ups most of which go bust anyway. If what they are working on is of value and the people have talent the same folks will reorganize a new venture within weeks. This is von Mises 101. When companies blow up they don't just leave a perpetual black hole. The vacuum gets filled. And the new venture will be run by people more prudent. And for the wineries - most of those are tax shelters for the rich. Link to comment Share on other sites More sharing options...
sandy beach Posted March 12, 2023 Report Share Posted March 12, 2023 1 hour ago, sandy beach said: Just noticed that's a Porsche Cayenne. The middle class needs to bail out these folks? Link to comment Share on other sites More sharing options...
sandy beach Posted March 12, 2023 Report Share Posted March 12, 2023 Good lord! I think I'm going to need a drink if this is what is coming tomorrow. Link to comment Share on other sites More sharing options...
Jimi Posted March 12, 2023 Report Share Posted March 12, 2023 5 minutes ago, sandy beach said: And the jobs argument - give me a break - these are high risk start-ups most of which go bust anyway. If what they are working on is of value and the people have talent the same folks will reorganize a new venture within weeks Or, the VCs backing them can pony up some more capital to bridge them through. Maybe it costs founders something, and maybe the return to the VCs suffers. That's the return cost for the risk both took, knowingly or unknowingly. And all of this is predicated on the notion that an orderly liquidation of SVB's assets won't make depositors whole. According to the Interwebs, the CFO of Roku is a guy named Steve Louden. He owns no further shares in the company, but he did net over $100m selling out his holdings the past 5 years. https://www.benzinga.com/sec/insider-trades/roku/steve-louden Ridiculous. Link to comment Share on other sites More sharing options...
fxfox Posted March 12, 2023 Report Share Posted March 12, 2023 2 hours ago, Jimbo said: THE OTHER BIG QUESTION Who is on the other side of the interest rate swaps with the banks providing the insurance against rate rises???? Whoever they are are bleeding big time. Great short candidates if publicly traded. An ETF idea????? Need a catchy name for marketing purposes. "The Swamped ETF" Well, other banks. Deutsche sells fix to receive float from BNP Paribas for example. Usually both counterparts have the same central clearing counterparty, in Europe that‘s EUREX. https://en.m.wikipedia.org/wiki/Central_counterparty_clearing The system can handle a collapse of minor banks, regional banks for example. But it can absolutely not handle a collapse of a major bank. That‘s why JPM, BofA, Citi, Deutsche, Mizuho have to survive at any time at any cost. Link to comment Share on other sites More sharing options...
fxfox Posted March 12, 2023 Report Share Posted March 12, 2023 1 hour ago, sandy beach said: Good lord! I think I'm going to need a drink if this is what is coming tomorrow. There will be some kind of a „bailout“, sure. Could be a major bank buys the whole shit, maybe this evening, Bitcoin already 1400 points above Fridays low. Link to comment Share on other sites More sharing options...
fxfox Posted March 12, 2023 Report Share Posted March 12, 2023 100 point gap up comming? Link to comment Share on other sites More sharing options...
sandy beach Posted March 12, 2023 Report Share Posted March 12, 2023 Link to comment Share on other sites More sharing options...
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