As I watched the sudden collapse of the Silicon Valley Bank, I marveled once again at how a geezer’s administration run by tokens of diversity can wreck the economy by turning mundane functions — say, unloading transport ships — into extraordinary catastrophes, such as a supply chain backlog.
Giving billions of dollars to people who promote and support things like DEI, ESG, LGBQT, etc is not productive investment. "The whole of government" (as they say) is now laser-focused on keeping itself in power. The Silicon Bank failure is (I believe) a federally produced event to distract from what Pence-Pelosi-Schumer-McConnell accomplished on January 6th 2021: The Parliamentary Motive Behind the J6 Fedsurrection https://theconservativetreehouse.com/blog/2023/03/12/the-parliamentary-motive-behind-the-j6-fedsurrection/
I can certainly attest to your comments about PNC Bank. When I went to renew my CD's back in February, I saw that my two IRA's had actually LOST money. The banker I spoke to said that he could renew my IRA's now paying 4%. I said "You have 100K of my money and you are deducting fees ?" I could not contain my anger. I told this idiot to close my accounts and I will never EVER do business with PNC again.
To the fools who voted for a senile jackass like Joe Biden, not that were many that really did, yolu got what you wanted and we will all pay the price. If you haven't prayed before, now is a good time as any to start.
I had a really nice comment and lost it. It is too early and how in the blazes did I miss it was the weekend for Daylight savings time change? That is a sad idea that needs to be discarded.
So I am going to try again.
Part of the problem is that when the crash of "08=09' happened, Congress decided there needed to be new rules but that they knew nothing of banking. So they had the bankers write the new rules. Something like letting the Fox run the Hen house but they did it. And Congress didnt make sure there were accountability rules in place for the bailouts, so the banks ran and no one could say where any of the money went other than it was gone.
So fast forward. The Board of this Bank was very careful not to trigger the higher level scrutiny that came with being just a pinch bigger. They failed to record their liabilities in Q4 (which I am pretty sure is illegal) and had to record them in Q1. (If I can find the link, I will) So they acted similar to a bunch of the companies that buy retail stores, run up the debt in loans against the store. Then let the store take the hit in bankruptcy and they run off with the cash. These guys did it a little different, they ran up the liabilities in Green Energy loans, and combined with Biden's torching of the economy and printed money, and interest, that all came crashing down. So the Board knew this was coming when they had to actually report the true liabilities in Q1 and sold all their stock. Shades of Enron..... but these are (D)ifferent.
So Yellen and the Federal Reserve decided to create money out of thin air, not go through Congress and bail them out. No matter how much Yellen says this is not a bail out -- it is. If I ran my household like this bank did, I would expect to be in bankruptcy. Hell there are rules that say I cant borrow more than 35% of what I make/assets but damn the BANKS can run a margin their liabilities up to 95% or greater than their assets. Yeah and there are laws against that too.
Bring back tarring and feathering for business leaders and politicians who screw up.
It's like a repeat of 2008. And yes, Jim Cramer played his role again by assuring everyone that everything will be OK. Fire him already. I was wondering who the depositors are in this bank. I've read that Estsy and ROKU are depositors along with other tech companies. This seems like a highly specialized bank when I think of Canada's staid banks. In Canada, we have 7 major banks (for consumers and businesses) and they are highly regulated. Husband works at one of them. This excludes credit unions. Eligible deposits are insured separately up to $100,000 in Canada and would include things like chequing, savings, term deposits and foreign currency accounts. We have one government bank for business lending ( I worked there on contract for two years). What would bothers me in the case of SVB is the Fed pulling a fast one on Sunday. So the Fed is listenning to depositor Mark Cuban? We also can't rule out the damage that ESG has done and will continue to do in the name of equity and climate. It should be DIE, not DEI because DIE is indeed what is happening. It seems to me that the problem with today's managers is that they are highly credentialed, but they don't have any real world experience because that is not the reason they were hired. So while they were busy organizing causes dear to them, the day-to-day job was not and is not getting done. We are seeing this over and over again the western liberal demcracies. We are running ourselves into the ground and willingly. How do you fix a stupid like that. Short answer: You don't.
My memory is the banking crisis of 2008 was primarily brought on by the mortgage business. During the Clinton administration they made banks give mortgage loans to people who wouldn't be financially able to pay it back. It was one of those efforts, even back then, to have diversity in the home purchasers. By the end of the Clinton administration defaults were happening left and right.
Diversity board member Barney Frank. Board member since 2015.
Board member Frank earned over $390k in 2021 and over $300k 2022 serving on the board.
Congressional insider Barney Frank.
Barney Frank - whose name is the Frank for the Dodd-Frank bill. A bill written by lobbyists.
The Dodd-Frank bill that Barney said would end bank bailouts.
Another diversity failure.
There will be no rate increase by the Fed, the stock market will fly to 40K and eggs will be $12/dozen. Who does it hurt? Middle class Trump voters. But at least no money for E Palestine Ohio residents.
1) Sam Bankman-Fried (Bahamas Ponzi-Bitcoin King), belly-up late 2022 = Lehmann Brothers (the first big bankruptcy in 2007).
You know what happened next.
2) Haven't seen anyone else say this, so may I do the honors?
Sam Bankman-Fried and Silicon Valley Bank are IDENTICAL creatures.
3) Yellen says no bailout for SV Bank. Good way to get Arkancided.
And there she was in the Ukraine, what, last week, handing them money that could have bailed out SVB?!
Janet! Mach Schnell!!! Put a stop payment on that check!!!
4) Monday March 13, 2023 (today):
Fun day today for Zuckerberg (Faceberg damnit Facebook) in Silicon Valley.
Who will be the first of his closest SVDFs (Sil Val "dearest friends") to call him this morning, asking for a, ahem, "loan"?
5) Tori Spelling's net worth will now be more than all of those dork-ass t-shirt creeps whose SVB $$$ have evaporated.
(TS: Washed-up actress and infamous bankrupt; her father Aaron, a TV mogul-billionaire, left her practically nothing in his will.)
6) I haven't had so much fun since Eliot Spitzer got his tits caught in the ringer in my birthday, back in 2008!
(He was the opening act to the Crash of that year.)
If this keeps up, Trump 2024 is in like Flynn.
You know, like Obama in 2008, with Frankenstein McCain clomping around in lead-shoed panic like a horse in a barn fire, suspending his presidential campaign, then an hour later, "un"-suspending it...
Let SVB swing in the wind until a bigger bank buys them at a fire sale price.
"...the Federal Reserve Board on Sunday announced it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors."
Total hypocrite. Under Pence's Christian veneer, is a devil's disciple. Our Lord is preparing a special place in hell for him. And he's gonna have to add a couple more acres for the rest of the lot.
Thank you for the history of SVB. And, yes, this box checking is going to be the death of our system.
"The rich already have insurance on their uninsured balances. It is called Congress. The rich know if they apply enough pressure from a foolish public, the rich always can get another bailout."
The real divide in this country is not race or sexuality or even politics. All those are distractions. The real divide is class.
So look at these two lines of thinking:
Everyone reading this Substack has to have health insurance because you *might* get sick and you *might* not be able to pay your bill. If you don't get insurance through Medicare or your work, and you aren't so poor you can get Medicaid, you have to find a high-priced, low benefit policy. Now they promise subsidies, but only up to a certain point. Two people with solid middle class incomes aren't going to qualify. So you end up paying, in my husband and my case, $917 a month for a plan with a combined $14k deductible. We're only in our late 40s. We have about 20 years until Medicare kicks in. A catastrophic plan would work better for us because we don't really use the medical system. We just need protection in case something really bad happens. But those plans are illegal because they don't foist sufficient responsibility on us. So we're way overpaying for what we need, but it's all because we might not be able to pay our bill and the hospital will "lose" money (translation, not make as much money) if they can't get us to cough up every bit of our savings, take a second out against our house, or put is into medical bankruptcy, all things that really only affect the behemoth hospital and the person involved.
Meanwhile . . . a bank, whose decisions affect every depositor, is allowed to only insure 3% of their deposits? And the people and businesses that don't get their money back are those that had more than 200,000 in accounts there? Wouldn't you love to have 200K sitting in a bank. (I understand payroll, but somehow I think that's a small part of what we're talking.) And if they get in trouble, the taxpayers bail them out. And no matter what they say, it always comes down to the taxpayers. That $25 billion doesn't automatically just appear out of nowhere. Someone has to underwrite it, either through inflation or taxation.
While this article was helpful toward understanding what led to this banks failure, I nevertheless struggle understanding all the mumbo-jumbo of the financial world.
It seems to me (remember, no sage here!), that this bank was primarily investing in “Green” energy, or the new ESG-type start-ups, and to a lesser extent, just basic banking customer deposit accounts.
When these Green tech companies couldn’t meet their loans, in an ever-increasing amount, they were in effect “defaulting”. So the bank was left holding a bag of green crap. Wow. What a surprise there - not.
And correct me if I’m wrong, but I believe investors are not eligible for any kind of bailout. In other words if I invest in your “better mousetrap”, and it fails, tough luck for me and you. It is an entirely different case than ordinary depositors.
Would be interested in knowing where I am off in this thinking.
Immutable characteristics mean nothing other than incompetent people have characteristics.
Biden moving into the presidency was a step in reverse for reason and sanity but a giant leap ahead in stupidity for which no cure exists.You can teach ignorant to read and reason.Don just gave the run down on how Americans have the stupidest politicians money can buy.Thank you Mr. Surber sir.