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Subject: The Collapse of SVB Portends Real Dangers

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Ed Gooding (VA)    Posted 03-11-2023 at 08:26:10 [URL] [DELETE]        [Reply] [Email]  
  • The Collapse of SVB Portends Real Dangers
  • Thus far in this 3-year fiasco of mismanagement and corruption, weíve avoided a financial crisis. Thatís for specific reasons. We just had not traveled there in the trajectory of the inevitable. Are we there yet? Maybe. In any case, the speed of change is accelerating. All we await is to observe the extent of the contagion.

    The failure of the Silicon Valley Bank (SVB), $212 billion in assets until only recently, is a huge mess and a possible foreshadowing. Its fixed-rate bond holdings declined rapidly in market valuation due to changed market conditions. Its portfolio crashed further due to a depositor run. And it all happened in less than a few days.

    Itís all an extension of Fed policy to curb inflation, reversing a 13-year zero-rate policy. This of course pushed up rates in the middle and right side of the yield curve, devaluing existing bond holdings locked into older rate patterns. Investors noticed and then depositors too. The high-flying institution that specialized in providing liquidity in industries that have lost their luster suddenly found itself very vulnerable.

    In addition, the bank was exposed with a portfolio of collateralized mortgage obligations and mortgage-backed securities. But with rates rising, those are coming under stress too as high leverage in housing and real estate become untenable amidst falling valuations. Borrowers are finding themselves under water and that in turn adds to stress on lenders.

    And where did SVB, and the entire banking industry, get the funds to bulk up their portfolios with such debt holdings? You guessed it: stimulus payments. Billions flooded in and it had to be parked somewhere making some return. At the time it seemed like a good deal, until Fed policy changed.
    ...

    Ed Gooding (VA)    Posted 03-13-2023 at 04:41:35 [URL] [DELETE]        [Reply] [Email]  
  • Yellen reverses herself
  • After stating that there would be no bailout of SVB and New York-based Signature Bank, which was closed on Sunday by the state chartering authority, Yellen has done a 180 and has authorized $25 BILLION in taxpayer money to bail out banks that made poor investment decisions with depositors' funds.

    Dean    Posted 03-13-2023 at 07:48:45 [URL] [DELETE]        [Reply] [No Email]  
  • Re: Yellen reverses herself
  • Bingo.

    Yellen will nearly always what is politically expedient.

    Never thought much of her.

    Dean    Posted 03-11-2023 at 19:35:11 [URL] [DELETE]        [Reply] [No Email]  
  • Re: The Collapse of SVB Portends Real Dangers
  • Bingo.

    This is how it starts.

    Of course, demos and their accomplices in the MSM are working feverously to figure out a way to blame Trump. Expect such to hit the MSM by Monday.

    Ed Gooding (VA)    Posted 03-11-2023 at 20:24:51 [URL] [DELETE]        [Reply] [Email]  
  • Re: The Collapse of SVB Portends Real Dangers
  • No doubt they will try to blame it on Trump.

    I wonder if they will even mention that the CEO and CFO of SVB sold their stock in SVB in January and reaped several million between the two of them???????

    Dean    Posted 03-11-2023 at 22:07:14 [URL] [DELETE]        [Reply] [No Email]  
  • Re: The Collapse of SVB Portends Real Dangers
  • Didn't take long.

    Bruce(OR)    Posted 03-11-2023 at 13:35:20 [URL] [DELETE]        [Reply] [No Email]  
  • Re: The Collapse of SVB Portends Real Dangers
  • What's that word?
    Oh yeah.

    "Bazinga!!"

    Meanwhile the price of gold has not significantly raised. Perhaps Monday?

    John in Mich    Posted 03-11-2023 at 15:49:06 [URL] [DELETE]        [Reply] [No Email]  
  • Re: The Collapse of SVB Portends Real Dangers
  • I have watched silver fluctuate and it is down approx. 10% in 30 days. Due to rebound?

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