Stock Market is ROCKING

[ditcherman]

The list of those exposed to SVB keeps growing. I am just rolling laughing because nearly every name are woke companies heavily invested in ESG and CRT.

Shopify, ZipRecruiter...now added. The list is getting longer by the minute. Also a boat load of non-profits that have supported nothing but democrats,blm,crt,and woke culture(what ever the current "thing" was/is).

This is an epic blood letting of woke culture.

I can not help but laugh.

It's just a shame that it will be the little guy (ok medium sized guy) that will suffer, as those who made the bad decisions also isolated themselves from the fall, exlemplified by the SVB ceo selling off all his stocks the last few days.

I have faith that their time will come, but that is also not my concern, as much as I'd like to see it.

 

[smokingman]

It's just a shame that it will be the little guy (ok medium sized guy) that will suffer, as those who made the bad decisions also isolated themselves from the fall, exlemplified by the SVB ceo selling off all his stocks the last few days.

I have faith that their time will come, but that is also not my concern, as much as I'd like to see it.

Little guys will suffer as well. Those medium and large size ones used SVB for payroll and inventory. Many companies are going to cease to exist. I think it was a zerohedge article that put the number of employees that will lose their jobs at 80-120k people unless the companies can get funding somewhere else(without having any capitol), as all the startups(even some that started decades ago still banked with SVB) are suddenly unable to meet payroll. I already see it reported to be happing.

A few of that number may not be woke,but most will be. You do not work at most of the places I have seen listed without being woke.

I wonder if they will learn from the experience. I have already seen an article blaming Trump for lax bank regulations(I do not believe they changed during his Presidency though).


This though from 5 days ago ROFL


This is even funny. Lost his side gig at the federal reserve, but he did make millions selling his SVB shares before the collapse. Over all a win for him as I am sure he has legal cover.

CEO of failed Silicon Valley Bank no longer a director at SF Fed

The chief executive officer of failed Silicon Valley Bank, Greg Becker, is no longer on the board of directors at the Federal Reserve Bank of San Francisco. Becker's departure was effective on Friday, a spokesperson for the Federal Reserve said. Earlier on Friday, Silicon Valley Bank was...

www.yahoo.com

 

[dieselrealtor]

Could be the tip of the iceburg.......

as it cuts through the hull of the Titanic.

 

[smokingman]

Could be the tip of the iceburg.......

as it cuts through the hull of the Titanic.

As I pointed out. Here is a visual of your iceberg.

Reverse Repo Operations - FEDERAL RESERVE BANK of NEW YORK

www.newyorkfed.org

SBV was of course using the repo window as well,but when you have withdraws that exceed your available funds you have to sell things not nailed down(stocks and treasuries in this case). Then you no longer have those to use at the Repo window as collateral. poof you fail.

I understand the Repo window process better now though.
See if you have treasuries as a bank and you know they are a loss due to rates being higher you can still use them at the repo window to keep from showing the loss. It does not however eliminate the loss and at some point reality will show itself. The fact it is 2.2 trillion dollars a day should alarm well...everyone.

Note what happens on the chart as rates started to rise. All the REPO window is doing is hiding losses(mostly on US Treasuries due to interest rates).

 

[Leadeye]

Creditanstalt 2023?

 

[smokingman]

10 banks that may face trouble in the wake of the SVB Financial Group debacle

Silicon Valley Bank wasn't well positioned for rising interest rates. Other banks show similar red flags.

www.marketwatch.com

 

[GodFearinGunTotin]

 

[GodFearinGunTotin]

 

[smokingman]

If Chase fails so does the entire house of cards. 3.3 trillion in assets. including almost 200 billion in US Treasuries. That does not include off the book derivatives which is FAR higher. They are currently the largest US bank.

JPMorgan Is Worried About Who’s Going to Buy All the Bonds

“We remain concerned about the (lack of) structural demand for Treasuries.”

www.bloomberg.com

In answer to their question. The Fed Repo window is the place they hide the losses. As for a buyer there really are not many. No where near enough to offset US spending. The Federal reserve is holding almost 6 trillion of them already, more than double what it was holding in 2020 already.

Assets: Securities Held Outright: U.S. Treasury Securities: All: Wednesday Level

Graph and download economic data for Assets: Securities Held Outright: U.S. Treasury Securities: All: Wednesday Level (TREAST) from 2002-12-18 to 2024-04-03 about maturity, securities, Treasury, and USA.

fred.stlouisfed.org

It really is a house of cards at this point.

Where did the FED get 3 trillion more in US Treasuries?

https://ticdata.treasury.gov/Publish/mfh.txt

This as of the 9th. If you are curious who held the stock of SVB(when the stock stopped trading)

SIVBQ - SVB Financial Group Shareholders - CNNMoney.com

Vanguard and Blackrock along with quite a few others took some huge losses. Vanguard alone had

$1,939,607,301 in stock on the 9th,that went to 0 on the tenth,and yes they were still buying it on the 9th. They may have gotten rid of some in after market trading but no way the got rid of most. There were almost no buyers at that point.

 

[ditcherman]

Little guys will suffer as well. Those medium and large size ones used SVB for payroll and inventory. Many companies are going to cease to exist. I think it was a zerohedge article that put the number of employees that will lose their jobs at 80-120k people unless the companies can get funding somewhere else(without having any capitol), as all the startups(even some that started decades ago still banked with SVB) are suddenly unable to meet payroll. I already see it reported to be happing.

A few of that number may not be woke,but most will be. You do not work at most of the places I have seen listed without being woke.

I wonder if they will learn from the experience. I have already seen an article blaming Trump for lax bank regulations(I do not believe they changed during his Presidency though).


This though from 5 days ago ROFL


This is even funny. Lost his side gig at the federal reserve, but he did make millions selling his SVB shares before the collapse. Over all a win for him as I am sure he has legal cover.

CEO of failed Silicon Valley Bank no longer a director at SF Fed

The chief executive officer of failed Silicon Valley Bank, Greg Becker, is no longer on the board of directors at the Federal Reserve Bank of San Francisco. Becker's departure was effective on Friday, a spokesperson for the Federal Reserve said. Earlier on Friday, Silicon Valley Bank was...

www.yahoo.com

Our very own @Cameramonkey missed a side gig paycheck Friday due to this, he stated in the other thread talking about it, wherever that is.

 

[smokingman]

Great teardown of the SVB website. They did it for the "lulz" at the failed wokeness.

Zerohedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

Hedge funds are circling looking to buy deposit accounts for 60 cents on the dollar(the FDIC has to pay off creditors, before any non-insured depositors get funds). IE other banks are getting paid before depositors with over 250k see a penny of their funds.

Bailin is the term(Cyprus is fairly familiar with it).
I posted this article before, but some may need a reminder of what is happening and why.

Why Bank Bail-Ins Are the New Bailouts

Public outcry over rescuing banks with taxpayer money in 2008 forced a switch in governmental tactics, making bail-ins the new bank bailouts.

www.investopedia.com

Hedge funds offering to buy startup deposits stuck at Silicon Valley Bank, Semafor reports

Hedge funds are offering to buy startup deposits stranded at Silicon Valley Bank (SVB) for as little as 60 cents on the dollar, Semafor reported on Saturday, citing people familiar with the matter.

www.reuters.com

 

[smokingman]

Loads of other banks and investing firms already own the stock and are taking billions in losses.
Schwab alone has gone from 82 a share to 61. All banks though are down(Chase down 7.3% as I write this)because they became dependent on each other to float capitol requirements.

I suspect the next emergency fed meeting within days

Pfft all I have is popcorn and a report to be issued sometime later. I am kind of shocked they are waiting until Monday(I seriously doubt they are actually,Monday is just the official announcements of what they are doing).

Fed to hold meeting on Monday in wake of SVB's swift collapse, seeks to avoid widespread panic By Investing.com

Fed to hold meeting on Monday in wake of SVB's swift collapse, seeks to avoid widespread panic

www.investing.com

3rd emergency meeting under Biden's careful watch,even with his Treasury secretary a former FED banker.

 

[ditcherman]

Great teardown of the SVB website. They did it for the "lulz" at the failed wokeness.

Zerohedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero

www.zerohedge.com

View attachment 261836

Hedge funds are circling looking to buy deposit accounts for 60 cents on the dollar(the FDIC has to pay off creditors, before any non-insured depositors get funds). IE other banks are getting paid before depositors with over 250k see a penny of their funds.

Bailin is the term(Cyprus is fairly familiar with it).

Hedge funds offering to buy startup deposits stuck at Silicon Valley Bank, Semafor reports

Hedge funds are offering to buy startup deposits stranded at Silicon Valley Bank (SVB) for as little as 60 cents on the dollar, Semafor reported on Saturday, citing people familiar with the matter.

www.reuters.com

I’m no financial genius.

Ok. Do I really even have to say that?

But that was a hilarious read.
Somewhat informative as well.

 

[HoosierLife]

Capitalism is great. Fractional reserve banking… not so much.

We lost this fight 200 years ago.

 

[smokingman]

Capitalism is great. Fractional reserve banking… not so much.

We lost this fight 200 years ago.

1913. When a quorum of congress critters created the federal reserve system and gave up constitutional currency backed by gold and silver.

 

[smokingman]

Oprah is losing 590 million due to SVB accounts rofl





They may have only had 209 billion in assets, but held over 342 billion in client funds.

 

[DragonGunner]

I saw where people who had money at SVB were insured for up to $250,000. Then said over 80% will never recover all their $. That’s a big loss. Rome is falling cause we are doing everything Rome did. Get ready.

 

[Destro]

2022 4th quarter results. Like I said,the final run due to them selling treasuries at a 1 billion dollar+ loss to raise capitol was due to the companies poor performance. They lost 33 BILLION in Q4 2022.

That's not what that says... they had a decrease in deposits of $33bil. How would they have EPS of $4.62 and a 33 billion dollar loss?

"In the fourth quarter of 2022, SVB delivered Earnings Per Share of $4.62, Net Income of $275 million and a Return on Equity of 8.9 percent. For the full year 2022, we delivered Earnings Per Share of $25.35, Net income of $1.5 billion and a Return on Equity of 12.1 percent."

The estimate was $5.26 so either the analysts choked or they severely underperformed estimates, but they didn't LOSE $33 billion dollars.

 

[smokingman]

That's not what that says... they had a decrease in deposits of $33bil. How would they have EPS of $4.62 and a 33 billion dollar loss?

"In the fourth quarter of 2022, SVB delivered Earnings Per Share of $4.62, Net Income of $275 million and a Return on Equity of 8.9 percent. For the full year 2022, we delivered Earnings Per Share of $25.35, Net income of $1.5 billion and a Return on Equity of 12.1 percent."

The estimate was $5.26 so either the analysts choked or they severely underperformed estimates, but they didn't LOSE $33 billion dollars.

Do you really believe the 80 billion they had in MBS in 2022 was making money and not already a loss? Some people understood they where losing money hence the withdraws. People started shorting them before Q4's report even came out, because there was zero chance they were not losing money on those MBS.

They like loads of banks had losses they were hiding with the Repo window and off their balance sheet. Does not matter for them now though, those losses were realized and they lost 80 billion in value between Thursday and Friday.

It was a very poorly run bank that used accounting gimmicks and the repo window to show a profit when they had already lost billions just on their MBS alone. The reason they had to show the loss of that 1.8 billion selling MBS is because they needed actual cash to try and cover deposits and outgoing funds. No one wanted them at mark to market as a 2 year treasury paid more interest with none of the risk. Showing that loss spooked a bunch of uninsured depositors, as it should have.

EPS has been pretty much meaningless for a long time, especially for banks when you as an investor can not see what is really on their books. They were beyond leveraged, hence not able to meet regulators 4.5% reserve requirement and failed. To say they could not even meet the reserve requirements is an understatment. Almost 1 billion in wire transfers failed because they did not have the funds on Friday. Hence the mid day regulator take over. So less than 0 reserves.

Page 11 of the Q4 report. What percentage of total funds were off balance sheet? 49% of the total. Pretty easy to hide losses when you keep them off your balance sheet. 4% of that being REPO.
https://s201.q4cdn.com/589201576/files/doc_financials/2022/q4/Q4_2022_IR_Presentation_vFINAL.pdf

 

[Leadeye]

Somehow I don't see the well connected like Oprah and the "H&M show" losing their cash. That's what having highly placed friends in dc are for. While preferential treatment in these sort of situations is wrong and probably illegal, big media will simply look the other way and complainers will be visited by thug government.