SVB Failed! Silicon Valley Bank.

[AzScorpion]

The Fed actually has too much power when it comes to manipulating the facts. That usually just delays the reality and creates a worse situation in the end.

Exactly! They should've seen this coming these past couple years but unfortunately they have political interests and didn't do a thing. Now that inflation is way out of hand they have no choice but to keep raising rates. Even Janet Yellen said earlier last year (I'm paraphrasing) she messed up and should've acted sooner.

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[Fordup]

One other part of the equation now is the internet can spread fear fast causing many to overreact and just about everyone is glued to it these days. People start dumping investments and the slide will be steep. Or they could start snapping up bargains base on people like Cramer making predictions.

 

[dtech]

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Exactly! They should've seen this coming these past couple years but unfortunately they have political interests and didn't do a thing. Now that inflation is way out of hand they have no choice but to keep raising rates. Even Janet Yellen said earlier last year (I'm paraphrasing) she messed up and should've acted sooner.

I think Greenspan was worse , didn't do a thing to warn regards the mortgage debacle afterwards meekly stated that he never imagined financial institutions could be corrupt and that home values could ever decline, dude just sat there and kept lending money to the banks who then made mortgage loans to anyone with a pulse

 

[Fordup]

.
I think Greenspan was worse , didn't do a thing to warn regards the mortgage debacle afterwards meekly stated that he never imagined financial institutions could be corrupt and that home values could ever decline, dude just sat there and kept lending money to the banks who then made mortgage loans to anyone with a pulse

Just like they have been handing out zero percent auto loans the last couple years.

 

[NotBudule]

 

[CB750F]

Digging a little deeper on another early retirement forum I'm on it looks like this could hurt many small companies. If SVB finances you, they require you to have accounts there. Those companies could have lost funds in this failure because 93% were over the FDIC insurance limit and will now be treated as creditors. The rest that are insured will have access to their money on Monday.

https://www.fdic.gov/news/press-releases/2023/pr23016.html

@AzScorpion
Correct, now you see the damage.
This is not 2008, but it's an everything bubble, debt is a huge problem. What cannot be payed back will not be payed back.
As for Jim Crammer, there is a reverse fund that got created,
so they short any of his recommendations. He said SVB
was not a problem a few days ago.
More quick reading:
https://mishtalk.com/economics/sili...s-93-percent-of-deposits-not-insured-what-now

 

[CB750F]

If anyone thinks that this is a non-issue, here is Credit Suisse weekly chart: From 2014 to today.

 

[AzScorpion]

One other part of the equation now is the internet can spread fear fast causing many to overreact and just about everyone is glued to it these days. People start dumping investments and the slide will be steep. Or they could start snapping up bargains base on people like Cramer making predictions.

Just like the TP shortages back in 2020. That right there just showed me how dumb people are in this country. You're concerned about TP when it's a respiratory virus going around?

As much as they're trying to admit we're been in a recession since last spring. They just changed the definition of it now to suite their needs. I've said it in my other thread I dumped everything into money market accounts right after the election. Yes they're not making much but I've protected all my capital from eroding away with the market swings we've been having. Timing the market isn't something I'd recommend but I watch it very close and have been lucky now and back in '08 when I did the same. Every investments has different guidelines where some of mine have 30 days where you have to wait again to get back out where Annies 401K with Fidelity she can move hers as much as she wants.

Many financial advisors advise against doing this for one main reason, they're lazy! They don't want to do the work which really isn't much but when you have a lot of clients or serve several businesses it can be time consuming. We're nearing retirement so we don't have time on our side to recoup any major losses.

 

[AzScorpion]

@AzScorpion
Correct, now you see the damage.
This is not 2008, but it's an everything bubble, debt is a huge problem. What cannot be payed back will not be payed back.
As for Jim Crammer, there is a reverse fund that got created,
so they short any of his recommendations. He said SVB
was not a problem a few days ago.
More quick reading:
https://mishtalk.com/economics/sili...s-93-percent-of-deposits-not-insured-what-now

Hopefully my first post didn't come off to harsh but I've been hearing so many people talking about the "sky falling" since the election.

I do agree it's bubble debt but we've had this for many, many years. Many (way to many) people live WAY beyond their means and use their credit cards like an ATM machine. I'm not trying to be heartless because there are some who have no choice and have fallen on rough times like medical issues, divorce or death of a spouse. For them I truly feel bad and hope they can pull themselves out. But for most it's self induced with "needs" like always having to buy the newest iPhone, eating out all the time or inking their bodies from head to toe yet swear they don't have enough money to retire. ?‍

What's going on now is a great example of why we should NOT be bailing out student loans. The country is broke and we have many more problems to deal with than those who willingly took out loans and now fell like they shouldn't have to pay them back. It's not free money (someone has to pay for this and it's usually us middle class) and it just adds to our mountain of debt we now have. Sorry, rant over you all enjoy your weekend!!! ?

 

[AzScorpion]

I've been thinking about the 93% of these businesses that left uninsured funds just sitting in SVB. With all the short term options available today why would one do that? Short term T Bills are at 5.25% and so are short term CD's. Anything over the FDIC limit could've easily been invested and sold if needed but leaving that much money uninsured by all these business isn't just dumb it's kind of scary. Scary that no one higher up in those companies thought to move their money into something making higher interest and being protected. Heck even the money market fund I use at Fidelity is paying 4.46% right now (and rising) and I have access to my money right away if needed.

 

[AzScorpion]

Yikes, some of these companies had a lot of money at SVB.

Roku had $487M

Rocket Lab USA had $38M

Roblox had $150M

https://www.thestreet.com/banking/s...b-roblox-also-affected?puc=yahoo&cm_ven=YAHOO

The majority of account holders at SVB, which on Friday was shut down by regulators and taken over by the FDIC, had balances that exceed $250,000, Gary Zimmerman, chief executive of MaxMyInterest, the New York financial-technology company, told TheStreet. The FDIC said on Friday it would take over Silicon Valley Bank and created the Deposit Insurance National Bank of Santa Clara.

Whether companies will receive 100% of their account balances or only a percentage remains unknown, said Anthony Chan, former economist for J.P. Morgan Chase, told TheStreet.

 

[dtech]

other execs punched out but only an additional mil. I'm sure they will say it had nothing to do with the impending collapse.

Silicon Valley Bank CEO Greg Becker. Silicon Valley Bank Chief Executive Officer Greg Becker sold $3.6 million of company stock under a trading plan less than two weeks before the firm disclosed extensive losses that led to its failure.14 hours ago

 

[KJRR]

.

Yikes, some of these companies had a lot of money at SVB.

Roku had $487M

Rocket Lab USA had $38M

Roblox had $150M

https://www.thestreet.com/banking/s...b-roblox-also-affected?puc=yahoo&cm_ven=YAHOO

So something I take away from this is that none of them had all thier cash @ svb.
Something to think about whether you have the max insured amount in the bank or not is not having all you eggs in one bank. With electronic xfers, makes it pretty easy to move money around now and should one bank have issues, you still have cash available at another.
Now I'm off to bury coffee cans in the back yard.

 

[AzScorpion]

.

So something I take away from this is that none of them had all thier cash @ svb.
Something to think about whether you have the max insured amount in the bank or not is not having all you eggs in one bank. With electronic xfers, makes it pretty easy to move money around now and should one bank have issues, you still have cash available at another.

Now I'm off to bury coffee cans in the back yard.

You're right KJ it's best to have your money spread out forFDIC safety and for accessibility. I have my main account at NFCU, my business account at First Bank which is a smaller stable bank and then a money market account at Fidelity. All can be EFT between them within a couple days.

Bury cans, we've seen your stash. Here's KJ doing his weekly inspection.

 

[CB750F]

Hopefully my first post didn't come off to harsh but I've been hearing so many people talking about the "sky falling" since the election.

I do agree it's bubble debt but we've had this for many, many years. Many (way to many) people live WAY beyond their means and use their credit cards like an ATM machine. I'm not trying to be heartless because there are some who have no choice and have fallen on rough times like medical issues, divorce or death of a spouse. For them I truly feel bad and hope they can pull themselves out. But for most it's self induced with "needs" like always having to buy the newest iPhone, eating out all the time or inking their bodies from head to toe yet swear they don't have enough money to retire. ?‍

What's going on now is a great example of why we should NOT be bailing out student loans. The country is broke and we have many more problems to deal with than those who willingly took out loans and now fell like they shouldn't have to pay them back. It's not free money (someone has to pay for this and it's usually us middle class) and it just adds to our mountain of debt we now have. Sorry, rant over you all enjoy your weekend!!! ?

np Dave.
I think we should get back to capitalism & let companies fail.
This would be very, very bad but if one makes 'good' decisions, you win, if you make 'bad' one's, then you lose.
We would be in a world of hurt, a little masochistic.
Have a good weekend ?? Wait, need more ???

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