How’s the stock market?

PRCD

Tom Curren status
Feb 25, 2020
13,163
9,273
113
  • Love
Reactions: casa_mugrienta

Driftcoast

Michael Peterson status
Aug 5, 2002
3,478
969
113
  • Sad
Reactions: casa_mugrienta

Aruka

Tom Curren status
Feb 23, 2010
12,473
24,093
113
PNW
What would you have done about inflation?
Well, since much of it has been caused by price gouging and supply chain issues and therefore cannot be solved only by increasing interest rates I would probably try not to raise rates so fast that I crashed the economy.

But Im not an expert like casa.
 

PRCD

Tom Curren status
Feb 25, 2020
13,163
9,273
113
Well, since much of it has been caused by price gouging and supply chain issues
How much?
and therefore cannot be solved only by increasing interest rates I would probably try not to raise rates so fast that I crashed the economy.
How quickly and how much? What are the Fed's other options?
 

casa_mugrienta

Duke status
Apr 13, 2008
44,576
19,428
113
Petak Island
Well, since much of it has been caused by price gouging and supply chain issues and therefore cannot be solved only by increasing interest rates I would probably try not to raise rates so fast that I crashed the economy.

But Im not an expert like casa.
:roflmao:

I'm by no means an expert, but I did pay attention in school.

But it's pretty clear from the first sentence you're a long way from understanding inflation and further, how interest rates work.

Also, thank you for proving my point from my earlier post:

It is so much easier, from a political perspective, to let inflation run because high prices can always be blamed on something else.
 

sdsrfr

Phil Edwards status
Jul 13, 2020
6,155
11,848
113
San Diego
let’s see those short positions! Lol.

imo this whole svb thing is similar to other banking info leaks as it shows the M.O. of startups and how naive a cfo can be.
 
  • Like
Reactions: Driftcoast

casa_mugrienta

Duke status
Apr 13, 2008
44,576
19,428
113
Petak Island
imo this whole svb thing is similar to other banking info leaks as it shows the M.O. of startups and how naive a cfo can be.
No leaks necessary

Screen Shot 2023-03-12 at 6.38.16 AM.png

Screen Shot 2023-03-12 at 6.37.12 AM.png


In other news, Newsome intervenes!

"California Gov. Gavin Newsom said Saturday that he’s talking with the White House to help “stabilize the situation as quickly as possible, to protect jobs, people’s livelihoods, and the entire innovation ecosystem that has served as a tent pole for our economy.”


I'm noticing more articles mentioning deposits are only "safe" up to $250k, and I am sure the vast majority of the public is unaware of this. If they start to realize they're only insured up to $250k per bank things could get interesting.

EDIT:

Yellen says no bailouts, "We good!"

 
Last edited:

sdsrfr

Phil Edwards status
Jul 13, 2020
6,155
11,848
113
San Diego
EDIT:
Yellen says no bailouts, "We good!"

Back room buddies have agreed, let the non-GSIBs bleed.

 
  • Haha
Reactions: casa_mugrienta

hammies

Duke status
Apr 8, 2006
15,948
14,936
113
Roku has got to be shitting bricks right now. Wondering if they're ever gonna get their money and make payroll.
 

vanrysss

Billy Hamilton status
Mar 25, 2019
1,685
3,797
113
from Oregon, now SD
It's not really "bailing out depositors". FDIC is going to sell SVB's assets to cover depositors, but might be a while until everyone is made whole which could obviously fuck over people and businesses that bank with them.
Read somewhere that one of the major wall Street banks will probably buy the whole bond portfolio for 100 cents on the dollar just to avoid the headache of this whole thing turning sour. It's not like SVB was buying up dog sh!t mortgages.
Shareholders are fucked, that's what bankruptcy does, lenders to SVB probably fucked too.
 

casa_mugrienta

Duke status
Apr 13, 2008
44,576
19,428
113
Petak Island
FDIC auction underway now for Svb assets.

Could be some cool sh!t at barg prices.

BTW, my invitation still stands for anyone who still wants to make a bet the “hawkish” Fed won’t pivot and cut. Any takers? Lol.
 

casa_mugrienta

Duke status
Apr 13, 2008
44,576
19,428
113
Petak Island
Read somewhere that one of the major wall Street banks will probably buy the whole bond portfolio for 100 cents on the dollar just to avoid the headache of this whole thing turning sour.
Turning sour? :roflmao:

I think you are rather underestimating what is about to go down.

There's a pretty good chance some large depositors are going to start pulling their $$$ out of certain banks in a big way, starting tomorrow AM. It's hard to believe people don't know about the 250K rule, but most do not. Now every news article has it in the first three paragraphs. They're going to begin parking their money elsewhere - other banks, T-bills, etc.

There's also a good chance the tide is going to start pulling out and a lot of banks are going to be naked. In other words, unable to provide owed funds to depositors in the coming days/weeks. Just like SVB. So what then? They'll start selling stuff like mortgage debts (low yielding at that - those amazing and mortgage/refi rates everyone jumped on are awful for lenders of course) at a loss. Not good.

But as @grapedrink said - depositors have no need to fear - the FDIC is here!

Where does the FDIC get it's money? From the government.

But the government is broke. So where would the government get the money?

The Fed.

Oh, but the Fed is doing QT.

Oops.

In other words, the Fed is going to have to pivot, cut rates, and resume QE in order to bail out the FDIC/depositors and let inflation run...likely precipitating a crash of the dollar.

OR

The Fed keeps fighting inflation, the bond market crashes and takes out more banks, and depositors take it up the ass.
 
  • Haha
Reactions: grapedrink

casa_mugrienta

Duke status
Apr 13, 2008
44,576
19,428
113
Petak Island
grapedrink said:
Maybe offer up a coherent rebuttle?

Seems odd the you're laughing while twice you've shown you had no idea what the current rate of inflation was, nor the fed funds rate and were operating under the assumption that everything between the two was fine 'n dandy.
 
  • Haha
Reactions: grapedrink