/biz/ - Business & Finance

[Anonymous No.54021614]

LOL

[Anonymous No.54021643]

yeah but they agreed to it

[Anonymous No.54021666]

>>54021614
glad at least one party looks out for the little guy

[Anonymous No.54021691]

>>54021614
this cant happen because the whole scam known as banks wouldnt work in first place

[Anonymous No.54021713]

>>54021666
there is only one party, you absolute retarted faggot.

[Anonymous No.54021759]

>>54021614
this is the guy that was fucking chinese spy agents

[Anonymous No.54021901]

>>54021666
>bank account larger than $250,000
>little guy
Get behind me Satan

[Anonymous No.54022226]

Shits fucked yo

[Anonymous No.54022271]

>>54021614
guess the bank had a lot of uh, tribal investors

[Anonymous No.54022289]

>>54021614
Fucking embarrassing.

[Anonymous No.54022341]

So the tax payer has to front the 200bn dollar bill when some idiots in venture capital make bad investments that go belly up? How about we let capitalism do its job and idiots lose their money

[Anonymous No.54022360]

>>54022341
Banking is about confidence.

[Anonymous No.54022368]

>>54022341
Reported for anti-semitism

[Anonymous No.54022375]

>>54021614
Don't worry, Sleepy Joe is about send another 50 billion to Ukraine

[Anonymous No.54022400]

[Anonymous No.54022403]

>>54021614
This is ((Sam Bankman-Fried’s)) fault.

[Anonymous No.54022448]

>>54021614
>WHAT DO YOU MEAN MY WAGENIGGERBUX AREN'T SAFE????????

[Anonymous No.54022460]

>>54022341
TOO BIG TO FAIL

[Anonymous No.54022477]

[Anonymous No.54022494]

>>54022341
You don't get it, chud. CONFIDENCE. TRUST. FAITH.

[Anonymous No.54022518]

WEEEEEEEEEEEEEEE

[Anonymous No.54022553]

>>54022477
LOL anyone who thought they made money in the last bull run is going to get rugged. Sorry goy you can't keep your gains

[Anonymous No.54022582]

NAH FUCK THE BANKS, MORE MONEY TO UKRAINE!!

[Anonymous No.54022589]

>>54022518
BasedTrump! So much winning!

[Anonymous No.54022617]

>>54022518
this was debunked

[Anonymous No.54022623]

>>54021666
>666
>little guy
>greater than $250k in a bank

[Anonymous No.54022663]

>>54021614
So basically every bank is free to play with whatever deposits they want, as risky as they want, getting the dividend payouts to their investors, and when the company goes under just give everyone their money back at the governments expense.

[Anonymous No.54022686]

>>54021614
It's not that difficult to break your accounts into $250k chunks. There is software to automate the whole process so you can operate exactly the same. No reason to hold millions of dollars in one account.

[Anonymous No.54022705]

>>54021614
These kikes deserve to lose their money.
They should reap what they have sown.

James 5:4 New King James Version (NKJV)
Indeed the wages of the laborers who mowed your fields, which you kept back by fraud, cry out; and the cries of the reapers have reached the ears of the Lord of Sabaoth.

[Anonymous No.54022707]

>>54022518
holy shit we have bank failures at such a tiny little dip, things are going to get intredasting

[Anonymous No.54022721]

>>54022663
yes

[Anonymous No.54022736]

>>54022477
Well, unless that's paired with a massive taxes on the wealthy to remove money from the system.

QE should always have been paired with a high marginal tax rate.

[Anonymous No.54022746]

>>54022663
look up Glass-Steagall

[Anonymous No.54022758]

>>54022518
It's been nearly 3 years and I still have to explain to you retarded niggers that this chart is based on bad data. They changed the definition of M1 in May 2020 to include savings deposits, leading to the $11 Trillion discontinuity in the chart. Just use M2 money supply, it still paints a picture of massive money printing without needing to lie about it.

[Anonymous No.54022768]

>>54022707
the system is predicated on the money supply always going up, hence why biztards were screaming about it being "impossible" for the fed to raise rates, because doing so would be unimaginably destructive. they were right - unfortunately for them, the fed does not care, because clearly the bankers WANT it to crash

[Anonymous No.54022787]

>>54022341
stop being hateful. please read up on how antisemitism was able to fester in germany which then led to 6 million jews dying in the holocaust.

[Anonymous No.54022805]

>>54022663
Stop noticing things.

[Anonymous No.54022813]

>>54022341
A small price to pay so the banks can keep making profit. It's a good investment if you think about it, you wouldn't want your >$250k deposit to disappear as well, would you?

[Anonymous No.54022862]

>>54022663
>the governments expense.

your expense, actually

[Anonymous No.54022882]

>>54022341
Enough antisemitism for today.

[Anonymous No.54023874]

[Anonymous No.54023914]

>>54021666
Nobody banking at SVB is a little guy.

[Anonymous No.54023940]

>>54021614
who needs 250k in cash? perfect deflationary opportunity. let it burn.

[Anonymous No.54023952]

>>54021666
Yeah the uniparty

[Anonymous No.54023961]

>>54021614
>agree to only have up to 250k insured
>put more than 250k in the account
>reeeeeeeeeeeeeee what about my cash over the 250k???
Are republicans actually this stupid?

[Anonymous No.54023963]

>>54022477
but if that cash is removed from the system anyway is it really printing more money?

[Anonymous No.54023991]

>>54023874
Jesus fucking christ

Oh well time to waste time on congress hearings that don't do shit!!

[Anonymous No.54024177]

>>54023874
>>54023991
It could have just been a scheduled selloff, as part of a vestment schedule, that headline alone doesn't mean anything.

[Anonymous No.54024226]

>>54022736
Blame the ancom reaganites for fooling the average person into thinking less taxes for the rich were in their best interest

[Anonymous No.54024245]

>>54022341
Shut it down!
>>mfw solar flare tonight

[Anonymous No.54024265]

>>54021614
he's getting a lot of angry phone calls from the businessman who put him in office.

[Anonymous No.54024341]

>>54023961
>republicans
Oh no no

[Anonymous No.54024410]

>>54021614
no refunds.
if you had 1mm in there you lost 750k, fuck you
have some personal responsibility

[Anonymous No.54024436]

>>54022736
QE just shouldn't exist. monetary orthodoxy is peak darwinian efficiency

[Anonymous No.54024443]

>>54022736
QE shouldnt exist. KYS Wall Street shill.

[Anonymous No.54024821]

>>54022623
I remember that meme

[Anonymous No.54024923]

The FDIC insurance is for normal citizens, not for corpos. 99.99% of people will never have more than $250k in their bank account. Even Rich people won't because they are smart enough to know that money in the bank is money losing value due to inflation rate

[Anonymous No.54025050]

>>54022341
this isnt your little eve online server or what ever video game comes to mind. This is real life, thats the only reason why we have a state and a central monetary system
so that when things dont go as predicted or the worst case scenario ends up being the case we dont revert back to pre industrial civilization

[Anonymous No.54025530]

>>54023874
This literally means nothing. Also why are you following holes on twitter?

[Anonymous No.54025717]

>called bank
>can't bank on them having your money

[Anonymous No.54025941]

>>54025050
ah yes, I remember when all those mom and pop shops went bankrupt during the scamdemic the state and all those high net worth individuals got together to help us!

[Anonymous No.54026215]

>>54022617
i'll debunk your life faggot. the FED changing the definition of M1 after the fact is not debunking.

[Anonymous No.54026360]

>>54022617
Wrong. It was rebunked.

[Anonymous No.54026381]

>>54021614
lol if these faggots actually get bailed out

[Anonymous No.54026513]

[Anonymous No.54026605]

>>54022736
You people don’t get that you can’t tax people who are rich enough to create their own charities that others manage for them to funnel their own money into. Keep listening to another 60 years of “we’re gonna eat the rich” from the same party that acts like perpetual welfare in ghettos is going to solve their issues.

[Anonymous No.54026636]

>>54022341
Cool it with the antisemitism

[Anonymous No.54026708]

>>54022341
this "umm but what about le capitalism" *smug trannoid face* argument doesn't work anymore because the government already spends way more on funding a shady proxy war with russia and weird uncanny culture war stuff

[Anonymous No.54026715]

>>54022341
This. I hate all Congress members right now but especially these treacherous democrats.

This time the hyperactive US Federal Government is taking over a crypto-affiliated company & confiscating what's left of it under the guise of "protecting investors". No, they are just enriching themselves.

The CEO's were even allowed to sell their shares first.

[Anonymous No.54026779]

Felt like just a few days ago they were saying
>no bailouts for crypto

[Anonymous No.54026801]

>>54022477
Wrong.
It's either the greedy kikes that greedily chose to do business with Silicon Valley Bank lose their money, or all Americans are forced to suffer to save those few kikes when the Fed starts printing more money again to rescue them as they did in 2008.

The current Federal government needs to be fucking abolished.

[Anonymous No.54026814]

>>54022663
yes this is called usury and the sole reason banks exist

[Anonymous No.54026837]

>>54022736
No.

[Anonymous No.54026839]

>>54022736
The intention is to steal from the middle class and poor, so good luck with that.

[Anonymous No.54026853]

>>54022341
This is reportable

[Anonymous No.54026856]

>>54026513
Wow Fake News Elite really is begging for a bailout now.
Fucking greedy lying kikes.

[Anonymous No.54026883]

>>54022341
thin ice, bud. real thin ice

[Anonymous No.54026886]

>>54025050
Cope, kike shill.
Big Kike Daddy Government is lying to you and stealing from the American people.

[Anonymous No.54026911]

Guys don't go to your bank on Monday and withdraw everything

[Anonymous No.54026947]

Guys I'm going to my bank on Monday and withdrawing everything

[Anonymous No.54026963]

>>54026839
Yeah, it's always been quantity over quality with the greedy Feds.
There are far more goyim than rich white guys besides they want to protect their little club and keep us all out of it

[Anonymous No.54026986]

>>54026911
>>54026947

[Anonymous No.54026988]

>>54021614
lol here we go again.

you vill bail out the banks goy

[Anonymous No.54027139]

>>54022518
We can go even higher.

[Anonymous No.54027180]

>>54026715
What's funny is that is blatantly illegal and they didn't even try to hide it and nothing will be done about it.

[Anonymous No.54027193]

>>54025050
>he thinks industrial civilization is a good thing

the sooner it all crumbles the sooner we can make a functional, sustainable system.

[Anonymous No.54027318]

>>54025050
Eve has unironically healthier economy than this jewish shit

[Anonymous No.54027484]

>>54021666
Yeah, keep that little goy - sorry, I mean guy - shut, slowly stealing his money and freedom, he won't notice.

>>54021713

[Anonymous No.54027625]

>>54022341
Sorry goy! Losses for thee, not for me!

[Anonymous No.54027723]

>>54022736
Tax rates high can be good, but these "billionaire taxes" and degenerate income & wealth taxes are insane and stagflationary.

All they cause is Argentina tier demonetization of the kosher financial system while all money goes under the mattress in hard currency which ads inflationary pressures.

The problem here is that taxes are "on individuals" on "random x level" , and not on assets like housing.

[Anonymous No.54028248]

>>54021614
make them be in trouble then

[Anonymous No.54028459]

>>54021614
Ofc it’s a Democrat lol they gaslight everyone all day that they care about the little guy meanwhile they support and assist scumbags like SBF/FTX and now want to bail out millionaires. Kek

[Anonymous No.54028504]

>>54021666
>party
Glownigger please

[Anonymous No.54028635]

>>54022341
Woah buddy, that's a little too antisemitic for this board

[Anonymous No.54028717]

>>54022341
The antisemetism on this board is really getting out of hand

[Anonymous No.54028953]

>>54022663
Privatised profit, socialised losses, same as it ever was.

[Anonymous No.54029014]

>>54021614
>Eric Swalwell
the guy who's been selling our secrets to china in bed with a spy???? not trying to save face for being an absolute retard?????

[Anonymous No.54029102]

>>54023961
>silicon valley
>republicans

[Anonymous No.54029105]

>>54021666
I think this was just a sarcastic comment not even meant to be bait, but look at all the retards on this board. My goodness. Also checked

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029158]

>Latest Money Stuff Newsletter on SVB
The lesson might be that there are some industries that are bad to bank. Imagine that it was 2021, and someone was like “do you want to start the Bank of Crypto? What about the Bank of Venture-Backed Tech Startups?” You’d be tempted, right? Those industries had so much money! They seemed cool. If you were their bank — if you were the specialized bank that exclusively focused on those industries — influencers on Twitter would tweet nice things about you, and you’d get invited to fancy parties. Also, as their bank, you’d probably find a way to get a cut of growing industries with lots of potential. Provide banking services to tech startups, get warrants in those startups, get rich when they go public. Provide banking services to crypto exchanges, start some sort of blockchain-based payment network, get rich through the magic of saying “blockchain” a lot.

But the structure of being the Bank of Crypto or Startups was a bit rickety. Traditionally, the way a bank works is that it takes deposits from people who have money, and makes loans to people who need money. The weird problem with focusing exclusively on crypto or startups in 2021 is that they had too much money. If you were the Bank of Startups, the main service that you provided to startups is that equity investors would give them a truck full of cash and they’d deposit it at your bank. Here is how SVB Financial Group, the holding company of Silicon Valley Bank, describes the vibe of 2021 and 2022 in its Form 10-K two weeks ago:

>Much of the recent deposit growth was driven by our clients across all segments obtaining liquidity through liquidity events, such as IPOs, secondary offerings, SPAC fundraising, venture capital investments, acquisitions and other fundraising activities—which during 2021 and early 2022 were at notably high levels.

[Anonymous No.54029178]

>>54022518
What happened to $1.1T? Was it burned?

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029194]

People kept flinging money at SVB’s customers, and they kept depositing it at SVB. Perfectly reasonable banking service.

But the customers didn’t need loans, in part because equity investors kept giving them trucks full of cash and in part because young tech startups tend not to have the fixed assets or recurring cash flows that make for good corporate borrowers. [1] Oh, there is some tech-industry-adjacent lending you can do. [2] Tech founders want to buy houses, and you can give them mortgages. Venture capital and private equity funds want to manage liquidity and/or juice their reported return rates by paying for investments with borrowed money rather than drawing from their limited partners, so you can get into the capital-call-line-of-credit business. There are vineyards near Silicon Valley and you can develop an expertise in vineyard financing. And, sure, some of your tech-company customers do need to borrow money, and are creditworthy, and you lend them money and that works out. But there is a basic imbalance. Customer money keeps coming in, as deposits, but it doesn’t go out, as loans.

So you have all this customer cash, and you need to do something with it. Keeping it in, like, Fed reserves, or Treasury bills, in 2021, was not a great choice; that stuff paid basically no interest, and you want to make money. So you’d buy longer-dated, but also very safe, securities, things like Treasury bonds and agency mortgage-backed securities. We talked yesterday about how this worked out at Silvergate Capital Corp., the actual Bank of Crypto. And as of the end of 2022, Silicon Valley Bank, the actual Bank of Startups, had about $74 billion of loans and about $120 billion of investment securities.

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029208]

>>54029194
Crudely stereotyping, in traditional banking, you take deposits and make loans. In the Bank of Startups, in 2021, you take deposits and mostly buy bonds. Again crudely stereotyping, corporate loans often have floating interest rates and shorter terms, while bonds have fixed interest rates and longer terms. None of this is completely true — there are fixed-rate corporate loans and floating-rate bonds, traditional banking tends to involve making lots of loans (like mortgages) with long-term fixed rates, you can do swaps, etc. — but it is a useful crude stereotype. [3]

Or, to put it in different crude terms, in traditional banking, you make your money in part by taking credit risk: You get to know your customers, you try to get good at knowing which of them will be able to pay back loans, and then you make loans to those good customers. In the Bank of Startups, in 2021, you couldn’t really make money by taking credit risk: Your customers just didn’t need enough credit to give you the credit risk that you needed to make money on all those deposits. So you had to make your money by taking interest-rate risk: Instead of making loans to risky corporate borrowers, you bought long-term bonds backed by the US government.

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029228]

>>54029208
The result of this is that, as the Bank of Startups, you were unusually exposed to interest-rate risk. Most banks, when interest rates go up, have to pay more interest on deposits, but get paid more interest on their loans, and end up profiting from rising interest rates. But you, as the Bank of Startups, own a lot of long-duration bonds, and their market value goes down as rates go up. Every bank has some mix of this — every bank borrows short to lend long; that’s what banking is — but many banks end up a bit more balanced than the Bank of Startups. At the Financial Times, Robert Armstrong writes:

>Few other banks have as much of their assets locked up in fixed-rate securities as SVB, rather than in floating-rate loans. Securities are 56 per cent of SVB’s assets. At Fifth Third, the figure is 25 per cent; at Bank of America, it is 28 per cent.

>For most banks higher rates, in and of themselves, are good news. They help the asset side of the balance sheet more than they hurt the liability side. … SVB is the opposite: higher rates hurt it on the liability side more than they help it on the asset side. As Oppenheimer bank analyst Chris Kotowski sums up, SVB is “a liability-sensitive outlier in a generally asset-sensitive world”.

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029247]

>>54029228
But there is another, subtler, more dangerous exposure to interest rates: You are the Bank of Startups, and startups are a low-interest-rate phenomenon. When interest rates are low everywhere, a dollar in 20 years is about as good as a dollar today, so a startup whose business model is “we will lose money for a decade building artificial intelligence, and then rake in lots of money in the far future” sounds pretty good. When interest rates are higher, a dollar today is better than a dollar tomorrow, so investors want cash flows. When interest rates were low for a long time, and suddenly become high, all the money that was rushing to your customers is suddenly cut off. Your clients who were “obtaining liquidity through liquidity events, such as IPOs, secondary offerings, SPAC fundraising, venture capital investments, acquisitions and other fundraising activities” stop doing that. Your customers keep taking money out of the bank to pay rent and salaries, but they stop depositing new money.

This is all even more true of crypto — I mean, the Fed raised rates once and the entire crypto industry vanished? [4] — but it is not not true of startups. But if some charismatic tech founder had come to you in 2021 and said “I am going to revolutionize the world via [artificial intelligence][robot taxis][flying taxis][space taxis][blockchain],” it might have felt unnatural to reply “nah but what if the Fed raises rates by 0.25%?” This was an industry with a radical vision for the future of humanity, not a bet on interest rates. Turns out it was a bet on interest rates though.

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029260]

>>54029247
Here’s Bloomberg’s Katie Greifeld:

>Silvergate and SVB “in fact are victims of the same phenomenon as Fed tightening extinguishes froth from those parts of the economy with the most excess — and it’s hard to find more excess than in crypto and tech startups,” said Adam Crisafulli of Vital Knowledge.

And my Bloomberg Opinion colleague Paul Davies:

>Both crypto and venture capital booms were children of the ultra-low rates of the past decade and a half. Now, rising rates and the shrinking of the Federal Reserve’s balance sheet have burst those industry bubbles and increased the competition among banks for funding.

And so if you were the Bank of Startups, just like if you were the Bank of Crypto, it turned out that you had made a huge concentrated bet on interest rates. Your customers were flush with cash, so they gave you all that cash, but they didn’t need loans so you invested all that cash in longer-dated fixed-income securities, which lost value when rates went up. But also, when rates went up, your customers all got smoked, because it turned out that they were creatures of low interest rates, and in a higher-interest-rate environment they didn’t have money anymore. So they withdrew their deposits, so you had to sell those securities at a loss to pay them back. Now you have lost money and look financially shaky, so customers get spooked and withdraw more money, so you sell more securities, so you book more losses, oops oops oops. [5]

[Anonymous No.54029270]

>>54029247
>I mean, the Fed raised rates once and the entire crypto industry vanished?

so true! Banks shouldn't lend to dot com or internet businesses either. It can only end poorly after the dot com bubble.

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029283]

>>54029260
As Armstrong puts it, SVB had “a double sensitivity to higher interest rates. On the asset side of the balance sheet, higher rates decrease the value of those long-term debt securities. On the liability side, higher rates mean less money shoved at tech, and as such, a lower supply of cheap deposit funding.”

Also, I am sorry to be rude, but there is another reason that it is maybe not great to be the Bank of Startups, which is that nobody on Earth is more of a herd animal than Silicon Valley venture capitalists. What you want, as a bank, is a certain amount of diversity among your depositors. If some depositors get spooked and take their money out, and other depositors evaluate your balance sheet and decide things are fine and keep their money in, and lots more depositors keep their money in because they simply don’t pay attention to banking news, then you have a shot at muddling through your problems.

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029309]

>>54029283
But if all of your depositors are startups with the same handful of venture capitalists on their boards, and all those venture capitalists are competing with each other to Add Value and Be Influencers and Do The Current Thing by calling all their portfolio companies to say “hey, did you hear, everyone’s taking money out of Silicon Valley Bank, you should too,” then all of your depositors will take their money out at the same time. In fact, Bloomberg reported yesterday:

>Unease is spreading across the financial world as concerns about the stability of Silicon Valley Bank prompt prominent venture capitalists including Peter Thiel’s Founders Fund to advise startups to withdraw their money. …

>Founders Fund asked its portfolio companies to move their money out of SVB, according to a person familiar with the matter who asked not to be identified discussing private information. Coatue Management, Union Square Ventures and Founder Collective also advised startups to pull cash, people with knowledge of the matter said. Canaan, another major VC firm, told firms it invested in to remove funds on an as-needed basis, according to another person.

>SVB Financial Group Chief Executive Officer Greg Becker held a conference call on Thursday advising clients of SVB-owned Silicon Valley Bank to “stay calm” amid concern about the bank’s financial position, according to a person familiar with the matter.

>Becker held the roughly 10-minute call with investors at about 11:30 a.m. San Francisco time. He asked the bank’s clients, including venture capital investors, to support the bank the way it has supported its customers over the past 40 years, the person said.

[Anonymous No.54029323]

>>54022341
FUCK YOU

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029329]

>>54029309
Nah, man, you don’t get to be a successful venture capitalist by taking a long view or investing in relationships or being contrarian. I’m sorry, I’m sorry, this is unfair. Of course they were right — Silicon Valley Bank did collapse, and if you got your money out early that was good for you — but that is largely self-fulfilling; if all the VCs hadn’t decided all at once to pull their money, SVB probably would not have collapsed. [6]

But it did:

>Silicon Valley Bank collapsed into Federal Deposit Insurance Corp. receivership on Friday, after its long-established customer base of tech startups grew worried and yanked deposits.

>The California Department of Financial Protection and Innovation in a statement Friday said it has taken possession of Silicon Valley Bank and appointed the FDIC as receiver, citing inadequate liquidity and insolvency.

>The FDIC said that insured depositors would have access to their funds by no later than Monday morning. Uninsured depositors will get a receivership certificate for the remaining amount of their uninsured funds, the regulator said, adding that it doesn’t yet know the amount.

>Receivership typically means a bank’s deposits will be assumed by another, healthy bank or the FDIC will pay depositors up to the insured limit.

[Anonymous No.54029361]

>>54021614
by colleagues he means the chinese govt

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029363]

>>54029329
SVB’s capital stack looked roughly like this, as of Dec. 31:

-A tiny sliver of insured deposits (that is, deposits under the $250,000 FDIC limit), something like $8 billion worth out of $173 billion of total deposits. [7]
-Roughly $165 billion of uninsured deposits.
-Roughly $13 billion of “short-term borrowings,” meaning mostly Federal Home Loan Bank advances.
-Roughly $2 billion of long-term FHLB advances.
-Roughly $3 billion of long-term bonds.
-Maybe $4 billion of other liabilities, for a total of $195 billion of liabilities.
-About $3.6 billion of preferred stock.
-Common stock with a book value of about $12.4 billion and a market value, on Dec. 31, of about $13.6 billion.
It had assets of about $212 billion on that Dec. 31 balance sheet, though since then it has had to sell some assets and mark others down, and it’s not clear what they’re worth today. The California Department of Financial Protection and Innovation cited “inadequate liquidity and insolvency” when it put SVB into FDIC receivership, suggesting that the assets are worth less than the liabilities. The FDIC’s job, in receivership, is “efficiently recovering the maximum amount possible from the disposition of assets” to distribute to creditors.

[Anonymous No.54029370]

>>54022518
This pattern is called a "railroad spike."

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029384]

>>54029363
One obvious question is: If you are “another, healthy bank” working through this weekend to buy SVB and assume its deposits, how much would you pay for the assets, which were worth $212 billion in December? [8] I am pretty sure the answer is higher than $8 billion, the amount of insured deposits: The FDIC will not be on the hook for the insured deposits. The $15 billion of FHLB advances are also quite senior and will presumably be no problem to pay back.

I would also guess — not investing or banking advice! — that the answer will also turn out to be higher than $188 billion, which is the total amount of deposits plus FHLB advances. I say this not because I have done a detailed analysis of SVB’s assets but because it seems bad for the FDIC to wind up a big high-profile bank in a way that causes significant losses for depositors, including uninsured depositors. There was a run on SVB in part because there hasn’t been a big bank run in a while, and people — venture capitalists, startups — were naturally worried that they might lose their deposits if their bank failed. Then the bank failed.

[Anonymous No.54029395]

>>54022663
Not at all!
It's not the government's expense!

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029402]

>>54029384
If it turns out to be true that they lose their deposits, there could be more bank runs: Lots of businesses keep uninsured deposits at lots of banks, and if the moral of SVB is “your uninsured transaction-banking deposits can vanish overnight” then those businesses will do a lot more credit analysis, move their money out of weaker banks, and put it at, like, JPMorgan. This could be self-fulfillingly bad for a lot of weaker banks. My assumption is that the FDIC, the Federal Reserve, and the banks who are looking at buying SVB all really don’t want that. If you are a bank looking at buying SVB, and you do a detailed analysis of its assets and conclude that they are worth $180 billion, and you come to the FDIC and say “I will take over this bank and pay the uninsured depositors 95 cents on the dollar,” the FDIC is going to look at you and say “don’t you mean 100 cents on the dollar,” and you are going to say “oh right yes of course, silly me, 100 cents on the dollar.” [9]

Maybe I’m wrong about that, but if I am it’ll be bad!

[Money Stuff: Startup Bank Had a Startup Bank Run No.54029422]

>>54029402
Above that, though, I have no idea. The stock closed at $106.04 per share yesterday (a $6.2 billion market cap, roughly 50% of book value), and was halted today. The preferred was trading at about 60 cents on the dollar yesterday, also closed today. Byrne Hobart wrote the bull case yesterday:

>The simple way to look at SVB from an investing perspective is to separate the ongoing business from the balance sheet for a moment, and ask: what premium does SVB's business deserve to book value, in a hypothetical world where they didn't make a massive rates bet? Over the last twenty years, they've traded at an average of 2.3x tangible book value, and generally at a premium to their banking peers. So a simple way to value the business is to say that the fair value of the business is generally ~100 cents on the dollar in liquidating value and another ~130 cents on the dollar in franchise value. If that liquidating value has been vaporized by a rates bet, the surviving business is still worth a premium to book.

But that was yesterday, and the franchise value melts pretty quickly when you go into FDIC receivership. The bear case is … well, back in November, when crypto exchange FTX was still looking for a rescue (it never found one), I wrote that the traditional price for that sort of rescue is “we will buy your exchange, make sure that all your customers are made whole, and give you a Snickers bar in exchange for 100% of the equity.” That may be where this is heading.

[Anonymous No.54029650]

>>54025530
why are you avoiding the question raised by the query? the timing is suspicious. this has happened with numerous inside trades

[Anonymous No.54030347]

>>54029650
It could mean something, maybe not; its not very large sums

[Anonymous No.54030520]

>>54029309
Hi, Elon.